Songa Drilling, which is a Norwegian company whose shares are traded on the Norwegian OTC Market, is a drilling rig owner and operator. Songa Drilling owns three jackups, Songa Tellus, Songa Jupiter and Songa Neptune.
Under the terms of the Offer, Songa Drilling Shareholders will receive NOK 41.75 in cash for each Songa Drilling Share. The Offer values Songa Drilling's existing issued share capital at approximately NOK 2.8 billion (£247 million). It is expected that Songa will have net debt at the end of May of NOK 0.9 billion (£76 million) on completion of the acquisition, which Abbot will assume.
The Offer Price of NOK 41.75 represents:
A Partial Share Alternative will also be made available to all Songa Drilling Shareholders (other than to certain Overseas Shareholders), whereby they can elect to receive between 25 percent and 100 percent of the consideration payable to them in cash, with the balance of the consideration payable to them in New Ordinary Shares.
Irrevocable Undertakings to accept the Offer have been received by Abbot in respect of, in aggregate, 41,411,536 Songa Drilling Shares, representing approximately 62.1 percent of the existing issued share capital of Songa Drilling. Those shareholders who have irrevocably undertaken to accept the Offer have also undertaken to receive their consideration as to 25 percent in cash and 75 percent in New Ordinary Shares under the Partial Share Alternative.
Abbot has entered into a new committed finance facility of $950 million (£535 million) which will be used to finance the Offer, refinance certain existing indebtedness and pay transaction expenses, as well as to provide ongoing working capital for the enlarged Abbot Group.
The making of the Offer is subject to the satisfaction or waiver of certain conditions. These include:
The conditions to the Offer are set out in full in Appendix 1
Commenting on the Offer, Alasdair Locke, Executive Chairman of Abbot, said:
"This acquisition is an exceptional opportunity for the Group to expand its drilling rig fleet. With our experience of successfully operating jackup rigs and the existing demand from our clients for such rigs, we are confident that we shall achieve not only substantial additional cash-flows in the short term but a significant enhancement of our earnings in the medium to long-term"
Commenting on the Offer, Arne Blystad, Chairman of Songa Drilling, said:
"The offer from Abbot represents an attractive price for the shares in Songa Drilling and, accordingly, the board of Songa Drilling unanimously recommends the offer to its shareholders. The board is of the opinion that the combination represents a strategically attractive opportunity for both companies."
This announcement is an advertisement and not a prospectus and Songa Drilling Shareholders should not subscribe for or purchase any shares referred to in this announcement except on the basis of information in the Prospectus to be published by Abbot Group plc and the documentation to be sent to them in due course in connection with the Offer and the admission of the New Ordinary Shares to the Official List of the UK Listing Authority and to trading on London Stock Exchange's main market for listed securities. Copies of the Prospectus will, following publication, be sent to Songa Drilling Shareholders together with the Offer Document setting out the terms of the Offer. Copies of both documents will be available from the Company's registered office at 3 Colmore Circus, Birmingham, B4 6BH.
This summary should be read in conjunction with the full text of the "Recommended Cash Offer" which can be found on www.abbotgroup.com. Details of the Irrevocable Undertakings are set out in paragraph 4 and Appendix 2 of this announcement and certain terms used in this announcement are defined in Appendix 4.
There will be an analysts meeting at 11.00 a.m. (London time) today at the offices of Tavistock Communications at 131 Finsbury Pavement, London EC2A 1NT. A listen only conference call facility will also be available. For details, please call Gayle Mackay or Rachel Drysdale on 020 7920 3150.
This announcement does not constitute, or form part of, an offer to sell, or the solicitation of an offer to subscribe for or buy, any of the New Ordinary Shares to be issued in connection with the Offer. Any decision to accept the Offer should only be made on the basis of information in the documentation to be sent to Songa Drilling Shareholders in connection with the Offer which will contain further details relating to the Offer and Abbot in general as well as a summary of the risk factors to which an investment in the New Ordinary Shares is subject.
The New Ordinary Shares have not been and will not be registered under the United States Securities Act 1933, as amended, or under the applicable securities laws of any state of the United States of America, any province or territory of Canada, Japan or Australia. Accordingly, unless a relevant exemption from such requirements is available. The New Ordinary Shares may not, subject to certain exceptions, be offered, sold, taken up, renounced or delivered, directly or indirectly, within the United States of America, Canada, Japan or Australia or in any country, territory or possession where to do so may contravene local securities laws or regulations.
JPMorgan Cazenove Limited, which is regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Abbot and for no one else in relation to the Offer and will not be responsible to anyone other than Abbot for providing the protections afforded to customers of JPMorgan Cazenove Limited or for providing advice in relation to the Offer or on any matter referred to herein.
Past performance is not a guide to future performance. Potential investors should consult a professional adviser as to the suitability of the Offer for the individual concerned.
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