TGS Initiates Dispute Resolution Procedures in Relation to Merger
TGS-NOPEC Geophysical has formally initiated dispute resolution procedures in relation to the merger agreed with Wavefield Inseis.
The procedures, which are detailed in section 20 of the merger plan dated 20 August 2007, call for an initial 30 days negotiation period. If the parties are unable to reach an amicable solution within the said time period, arbitration proceedings in Oslo will be the next step.
TGS initiates the procedures with the aim to close the merger, as the current stagnation of the merger process is deemed unfortunate both for the merging parties, their employees and for their shareholders.
TGS has offered to have Wavefield Inseis meet with PriceWaterhouseCoopers ("PwC") to discuss their independent review of the events surrounding TGS' third quarter 2007 release. However, Wavefield has repeatedly stopped short of saying it would support the agreed upon merger terms even if TGS' actions were upheld by the joint review conducted by the two companies or PwC's independent review. To date, we have not been made aware of any facts, which draw into question any of TGS' actions related to this matter. While we are hopeful that Wavefield will reconsider its position during the 30-day negotiation period preceding arbitration and remain willing to work in good faith to resolve this matter, we are prepared to let the arbitration process address any disagreement with respect to the closing of the merger.
We remain of the view that there is no legal or factual basis for terminating the approved and agreed merger.
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