Sibir Energy and Gazprom Neft agree on terms of minority stake, Sibir Energy
Release Date: 2009-05-26
The board of Sibir (the “Board”) is pleased to announce that it has reached agreement with JSC Gazprom Neft (“Gazprom Neft”) on outline terms of a proposed recommended cash offer to be made by or on behalf of Gazprom Neft for the entire issued and to be issued share capital of the Company, excluding, inter alia, shares legally and beneficially owned by or on behalf of Gazprom Neft and shares legally and/or beneficially owned by certain other shareholders including Bennfield Limited, Central Fuel Company and the Bank of Moscow (the “Excluded Shares” as more fully defined in the “Notes” section below) (the “Offer”).
The unconditional Offer will be 500 pence in cash (the “Offer Price”) for every Sibir ordinary share of 10 pence each which is the subject of the Offer (the “Shares”).
The Company and Gazprom Neft intend to make available an offer document (the “Offer Document”), together with a form of acceptance (the “Form of Acceptance”) to holders of Shares (other than Excluded Shares) (“Qualifying Shareholders”) as soon as possible and in any event prior to 5.00 p.m. on Thursday 28 May 2009.
Framework Agreement
The Company, the directors of the Company (the “Directors”) and Gazprom Neft have entered into a framework agreement in respect of the conduct of the Offer and related matters (the “Framework Agreement”). The principal terms of the Framework Agreement are as follows:
· In consideration of Gazprom Neft entering into the Framework Agreement and agreeing to make the proposed Offer in the manner required by the Framework Agreement, the Board of Sibir has (pursuant to Article 193(B)(2)(c) of the Company’s Articles of Association), agreed to waive the requirements for, or procedures applicable to, an offer which would otherwise be subject to Article 193, such that the City Code on Takeovers and Mergers (the “City Code”) shall not (except as expressly provided in the Framework Agreement) apply to the Offer or proposed Offer, or the acquisition of any Shares by or on behalf of Gazprom Neft pursuant to the Offer or otherwise.
· The Board has undertaken to recommend the Offer, subject to the customary carve-outs permitting the Directors to withdraw, modify or qualify their recommendation in order to comply with their fiduciary duties, in certain limited circumstances and only if so advised by leading counsel. The full background and reasons for recommending the Offer will be set out in the Offer Document.
· The Offer will be made by Renaissance Securities (Cyprus) Limited (“Renaissance Capital”) or one of its affiliates on behalf of Gazprom Neft and will remain open for acceptances until the day falling twenty-one days from the date the Offer Document is made available (“Day 21”). On Day 21, to the extent that any acceptances are outstanding, Gazprom Neft is not required to but may, at its sole election, extend the Offer for a period of up to a further thirty-nine days, or otherwise must comply with certain other agreed arrangements in respect of the purchase of outstanding Shares.
· Gazprom Neft will be under no obligation to increase the Offer Price, nor to extend the Offer to the Excluded Shares, in any circumstances.
· The Company has given customary undertakings as to non-solicitation of third party rival proposals or offers, that no break fee will be payable in respect of any third party proposals or offers, and as to conduct of business for the duration of the Offer.
· The Company has undertaken not to, and to procure that none of its associates shall, solicit any third party offers or proposals until 22 August 2009.
· In the event of any third party making a rival offer at a price higher than the Offer Price, the Company has undertaken to procure that the Directors do not recommend such offer for a period of five business days, during which time Gazprom Neft shall have the right to match such third party offer, and the Company has further undertaken to procure that the Directors favourably recommend any such matching offer from Gazprom Neft.
· Gazprom Neft has been given the right to require the appointment of a director to the Board of the Company from today’s date and the appointment of additional directors to the Board of the Company in certain specified circumstances.
· The obligations of the Company and Gazprom Neft will terminate in certain circumstances, including (at the Company’s sole election) if the Offer Document is not made available on or before 5:00 p.m. on 28 May 2009 (or such later time and date as may be agreed between the Company and Gazprom Neft) or if the Offer is not closed on or before 31 August 2009 (or such later time and date as may be agreed between the Company and Gazprom Neft prior to that date).
Related Party Transaction
Gazprom Neft is currently a substantial shareholder in the Company. Accordingly, the entering into of the Framework Agreement in respect of the proposed Offer is a related party transaction under the AIM Rules for Companies. The Directors consider, having consulted with the Company’s nominated adviser, Strand Partners Limited, that the terms of the Framework Agreement in respect of the proposed Offer are fair and reasonable insofar as the Company’s shareholders are concerned. In providing its advice to the Directors, Strand Partners Limited has taken into account the Directors’ commercial assessments of the Framework Agreement.
| Type: | NORMAL |
| Company: | Sibir Energy |
| Country: | Russian Federation |