TIDMCEO
RNS Number : 3796T
Coastal Energy Company
19 November 2013
CEPSA to Acquire Coastal Energy Company for C$19.00 per
Share
Delivers Significant and Immediate Value to Coastal Energy
Shareholders
HOUSTON, TX - November 19, 2013 -- Coastal Energy Company
("Coastal" or the "Company") (TSX:CEN) (AIM:CEO) announced today
that it has entered into a definitive merger agreement providing
for the acquisition by Compañía Española de Petróleos, S.A.U.
("CEPSA") of all of the issued and outstanding shares of Coastal at
a price of C$19.00 per common share in cash. The purchase price
represents a premium of 28% to the closing price of the Company's
common shares on the TSX on November 18, 2013. The purchaser is a
newly-incorporated CEPSA controlled entity in which Strategic
Resources (Global) Limited ("SRG") is an investor. The proposed
transaction has an aggregate value of approximately C$2.3 billion
including the assumption of C$51 million of net debt. The
transaction, which will be completed by way of statutory merger, is
expected to close in the first quarter of 2014.
Commenting on the acquisition, Randy Bartley, CEO of Coastal
said, "This transaction delivers significant and immediate value to
our shareholders. Our Board of Directors is unanimous in its view
that this transaction is in the best interests of Coastal Energy
Company and recommends shareholders vote in favor of this
transaction."
CEPSA Chief Executive Officer Pedro Miro commented, "Today's
announcement reflects an important step in increasing CEPSA's
E&P capabilities. Coastal's business comprises a high-quality
portfolio of upstream assets located in Southeast Asia, operated by
talented management and dedicated employees. We believe that
Coastal provides a tremendous foundation for furthering our E&P
strategy."
Jho Low, spokesperson for SRG added, "We are excited to invest
with CEPSA in Coastal. With our strong relationships in Asia and
CEPSA's strength in the E&P, we believe we can grow Coastal's
footprint in Asia and further enhance the Company's
operations."
The transaction will be funded by CEPSA's and SRG's available
financial resources.
Recommendation of the Coastal Energy Company Board of
Directors
The Board of Directors of the Company, after consulting with its
financial and legal advisors, has unanimously determined that the
transaction is in the best interest of the company and that the
consideration being offered to the Company's shareholders is fair
from a financial point of view. The Board of Directors has resolved
to unanimously recommend that the Company's common shareholders
vote their shares in favor of the merger at a meeting of
shareholders to consider the transaction which is expected to occur
in early January 2014.
Additional Information on the Transaction
The definitive merger agreement provides for, among other
things, a non-solicitation covenant on the part of Coastal, subject
to customary "fiduciary out" provisions, that entitles Coastal to
consider and accept a superior proposal and a right in favor of the
purchaser to match any superior proposal. If the definitive merger
agreement is terminated in certain circumstances, including if
Coastal enters into an agreement with respect to a superior
proposal or if the Board of Directors of Coastal withdraws or
modifies its recommendation with respect to the proposed
transaction, the purchaser is entitled to a termination payment of
US$76,000,000.
Completion of the transaction is subject to customary closing
conditions, including approval of two-thirds of the votes cast by
holders of common shares in person or by proxy at the meeting of
shareholders and by a majority of disinterested shareholders in
accordance with applicable securities laws, and receipt of
applicable government and other approvals. The transaction is not
subject to any financing condition.
Coastal shareholders will be asked to vote on the transaction at
a special meeting of the Company's shareholders, expected to be
held in early January 2014. Full details of the transaction will be
included in the Company's information circular to be mailed to
holders of Coastal shares in accordance with applicable securities
law. A copy of the merger agreement, the information circular and
related documents will be filed with Canadian securities regulators
and will be available at www.sedar.com.
Certain directors, senior officers and other shareholders of
Coastal, representing approximately 36.5 million of the Company's
issued and outstanding common shares, have entered into voting
support agreements with the purchaser and have agreed to vote their
shares in favor of the transaction, subject to the terms and
conditions of such agreements.
Credit Suisse Securities (USA) LLC has issued an opinion that
the consideration to be received by the shareholders of Coastal in
the transaction is fair to such shareholders from a financial point
of view.
Coastal's financial advisors are Citigroup Global Markets Inc.
and Credit Suisse Securities (USA) LLC. Coastal's legal advisors
are Stikeman Elliott LLP, Cleary Gottlieb Steen & Hamilton LLP,
and Walkers. Goldman Sachs International acted as financial advisor
to CEPSA. PriceWaterhouseCoopers acted as a financial advisor to
CEPSA and SRG. Freshfields Bruckhaus Deringer acted as legal
advisor to CEPSA. Blake, Cassels & Graydon LLP, Baker &
McKenzie International and Conyers Dill & Pearman, LLP acted as
legal advisors to CEPSA and SRG.
Forward-Looking Statements and Information
This news release contains forward-looking statements and
forward-looking information within the meaning of applicable
securities laws and which are based on the expectations, estimates
and projections of management of the parties as of the date of this
news release unless otherwise stated. More particularly and without
limitation, this press release contains forward-looking statements
and information concerning: the anticipated benefits of the
transaction to the parties and the Company's shareholders; the
timing and anticipated receipt of required shareholder and
regulatory approvals for the transaction; the ability of the
parties to satisfy the other conditions to, and to complete, the
transaction; and the anticipated timing of the meeting of Coastal
shareholders to consider the transaction and for the closing of the
transaction.
Forward-looking statements are defined by applicable securities
legislation and are qualified by the inherent risks and
uncertainties surrounding future expectations generally and also
may materially differ from actual future experience involving any
one or more of such statements. Such risks and uncertainties
include: uncertainties as to the timing of the merger; the
anticipated timing of the meeting of the shareholders of Coastal to
consider the transaction and uncertainties as to whether
shareholders of Coastal will approve the transaction; the risk that
competing offers will be made; the possibility that various closing
conditions for the transaction may not be satisfied or waived; the
possibility that various regulatory or other approvals will not be
granted; the satisfaction of various other conditions to the
completion of the merger as contemplated by the merger agreement;
and the possibility that expected benefits may not materialize as
expected.
Readers are cautioned that the foregoing list of factors is not
exhaustive. Additional information on other factors that could
affect the operations or financial results of the parties is
included in reports on file with the applicable securities
authorities. The forward-looking statements and information
contained in this news release are made as of the date hereof and
the parties undertake no obligation to update publicly or revise
any forward-looking statements or information, whether as a result
of new information, future events or otherwise, unless so required
by applicable securities laws.
About Coastal Energy Company
Coastal Energy Company is an international exploration and
production company with principal assets in Thailand and Malaysia.
Coastal owns and operates 100% of Blocks G5/43 and G5/50 in the
Gulf of Thailand as well as varying interests onshore northeast
Thailand including a 13.7% interest in the Phu Horm gas field.
Coastal is also party to a Small Field Risk Service Contract with
PETRONAS for the development and production of petroleum from the
Kapal, Banang and Meranti cluster of small fields offshore
Peninsular Malaysia.
About CEPSA
CEPSA is an integrated energy company operating at every stage
of the oil value chain, with more than 11,000 employees. It is
engaged in petroleum and natural gas exploration and production
activities; refining, the transport and sale of crude oil
derivatives; petrochemicals, gas, and electricity. CEPSA is Spain's
fourth largest industrial group in terms of turnover and has been
in the market for more than 80 years. Through progressive
internationalization of its activities, CEPSA also has business
interests in Algeria, Brazil, Canada, Colombia, Panama, Peru and
Portugal and sells its products all over the world. CEPSA is wholly
owned by International Petroleum Investment Company, which is
wholly owned by the Abu Dhabi government.
About Strategic Resources (Global) Limited ("SRG")
Strategic Resources (Global) Limited is a private investment
holding company controlled by international value investor Larry
Low H P.
CONTACTS:
Coastal Energy Company NOMAD
Email: investor@CoastalEnergy.com Strand Hanson Limited
+1 (713) 877-6793 (Nominated Adviser)
Rory Murphy / Andrew Emmott
+44 (0) 20 7409 3494
------------------------------------ -----------------------------
CEPSA SRG
Ignacio Rodríguez-Solano Edelman on behalf of SRG
Ignacio.Rodriguez-Solano@cepsa.com Jynwel@edelman.com
+34 91 3376766 +1 212 729 2463 / +1 212
704 8166
------------------------------------ -----------------------------
This information is provided by RNS
The company news service from the London Stock Exchange
END
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