TIDMFPM
RNS Number : 1210M
Faroe Petroleum PLC
03 January 2019
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, IN INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR
REGULATIONS OF THAT JURISDICTION
FOR IMMEDIATE RELEASE
3 January 2019
Faroe Petroleum plc (the "Company" or "Faroe")
DNO Offer fails to secure sufficient acceptances, moves to
mandatory offer
The Board of Faroe (the "Board", "we") notes the announcement by
DNO ASA ("DNO") on 3 January 2019 that it has received acceptances
of its unsolicited offer for the entire issued and to be issued
share capital of Faroe not already owned by DNO at 152p per share
in cash (the "Offer") of 48, 986, 566 Faroe shares, representing
approximately 13.1% of the existing issued share capital of Faroe.
The Board also notes that DNO has this morning purchased a further
372,890 Faroe shares, taking DNO's total share of the existing
issued share capital of Faroe to 30%, and has moved its Offer to a
mandatory cash offer.
The Board notes DNO's failure to secure sufficient acceptances
for its Offer to be declared unconditional by the first closing
date of 2 January 2019 and reiterates the Board's position that
DNO's Offer price of 152p per share is opportunistic and
substantially undervalues Faroe. This is further reinforced by the
independent valuation report on Faroe's assets by Gaffney, Cline
& Associates ("GCA") that Faroe published yesterday, which
implies a valuation for Faroe in the range of 186p to 225p per
share(1) .
The Board further notes that DNO has chosen to extend its Offer
until 1.00pm London time on 18 January 2019 at the same Offer price
of 152p per share, clearly suggesting that it has every intention
to pursue its unsolicited Offer despite its earlier statements
raising the prospect that the Offer may lapse if sufficient
acceptances were not received by the first closing date of 2
January 2019. DNO's further market purchases also highlight
this.
The Board is concerned at DNO's increasing attacks on Faroe's
outstanding exploration track record and its implied criticism of
our technical team which boasts one of the best exploration track
records on the NCS. It is a particularly puzzling criticism given
that Faroe would provide DNO with a high quality, full cycle and
diversified North Sea asset base that stands in stark contrast to
DNO's existing business. In fact, DNO's statement that it is "not
going away" demonstrates the attractiveness of Faroe to DNO. As
such, Faroe would solve DNO's strategic challenges and shareholders
should receive an appropriate premium which is not currently
reflected in DNO's Offer.
The Board reiterates the following observations in relation to
the Offer timetable, as established by the UK Takeover Code:
-- DNO has until 27 January 2019 to improve or otherwise change
its Offer, should it wish to do so
-- DNO has until 10 February 2019 to achieve sufficient
acceptances for its Offer to become unconditional
-- If the Offer at any time becomes or is declared
unconditional, DNO must keep it open for acceptance for at least
another 14 days
Shareholders are encouraged not to take any action in relation
to the Offer and not to sell their shares in the market.
Shareholders who sell their shares in the market or to DNO would
not receive any increase in the Offer consideration should DNO
revise its Offer.
- Ends -
For further information please contact:
Faroe Petroleum plc Tel: +44 (0) 1224 650 920
Graham Stewart, CEO
N M Rothschild & Sons Limited Tel: +44 20 7280 5000
Emmet Walsh / Elias Mitropoulos
Stifel Nicolaus Europe Limited Tel: +44 (0) 20 7710 7600
Callum Stewart / Nicholas Rhodes / Ashton
Clanfield
BMO Capital Markets Tel: +44 (0) 207 236 1010
Tom Rider / Jeremy Low
FTI Consulting Tel: +44 (0) 20 3727 1000
Ben Brewerton / Sara Powell / Toby Chidavaenzi
Footnotes
1) The implied valuation for Faroe in the range of 186p to 225p
per share is based on GCA's valuation range of Faroe's oil and gas
assets of US$879m to US$1,076m, converted assuming a USD:GBP
exchange rate of 1.27 as at 31 December 2018, adjusted for Faroe's
net cash balance of GBP49.6m as at 30 September 2018 (unaudited
management estimate) and assumes a fully diluted number of shares
outstanding of 398.3m
Further information
N M Rothschild & Sons Limited ("Rothschild & Co"), which
is authorised and regulated in the United Kingdom by the Financial
Conduct Authority, is acting exclusively for Faroe and no one else
in connection with the above and will not be responsible to anyone
other than Faroe for providing the protections offered to clients
of Rothschild & Co nor for providing advice in relation to the
subject matter of this announcement or any other matters referred
to in this announcement.
Stifel Nicolaus Europe Limited ("Stifel"), which is authorised
and regulated in the United Kingdom by the Financial Conduct
Authority, is acting exclusively for Faroe and no one else in
connection with the above and will not be responsible to anyone
other than Faroe for providing the protections offered to clients
of Stifel nor for providing advice in relation to the subject
matter of this announcement or any other matters referred to in
this announcement.
BMO Capital Markets Limited, which is authorised and regulated
in the United Kingdom by the Financial Conduct Authority, is acting
exclusively for Faroe and no one else in connection with the above
and will not be responsible to anyone other than Faroe for
providing the protections offered to clients of BMO Capital Markets
Limited nor for providing advice in relation to the subject matter
of this announcement or any other matters referred to in this
announcement.
The information contained within this announcement is considered
to be inside information prior to its release, as defined in
Article 7 of the Market Abuse Regulation No. 596/2014, and is
disclosed in accordance with the Company's obligations under
Article 17 of those Regulations.
Disclosure requirements of the Takeover Code
Under Rule 8.3(a) of the Takeover Code, any person who is
interested in 1 per cent. or more of any class of relevant
securities of an offeree company or of any securities exchange
offeror (being any offeror other than an offeror in respect of
which it has been announced that its offer is, or is likely to be,
solely in cash) must make an Opening Position Disclosure following
the commencement of the offer period and, if later, following the
announcement in which any securities exchange offeror is first
identified. An Opening Position Disclosure must contain details of
the person's interests and short positions in, and rights to
subscribe for, any relevant securities of each of (i) the offeree
company and (ii) any securities exchange offeror(s). An Opening
Position Disclosure by a person to whom Rule 8.3(a) applies must be
made by no later than 3.30 pm (London time) on the 10th Business
Day following the commencement of the offer period and, if
appropriate, by no later than 3.30 pm (London time) on the 10th
Business Day following the announcement in which any securities
exchange offeror is first identified. Relevant persons who deal in
the relevant securities of the offeree company or of a securities
exchange offeror prior to the deadline for making an Opening
Position Disclosure must instead make a Dealing Disclosure.
Under Rule 8.3(b) of the Takeover Code, any person who is, or
becomes, interested in 1 per cent. or more of any class of relevant
securities of the offeree company or of any securities exchange
offeror must make a Dealing Disclosure if the person deals in any
relevant securities of the offeree company or of any securities
exchange offeror. A Dealing Disclosure must contain details of the
dealing concerned and of the person's interests and short positions
in, and rights to subscribe for, any relevant securities of each of
(i) the offeree company and (ii) any securities exchange
offeror(s), save to the extent that these details have previously
been disclosed under Rule 8. A Dealing Disclosure by a person to
whom Rule 8.3(b) applies must be made by no later than 3.30 pm
(London time) on the Business Day following the date of the
relevant dealing.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a
securities exchange offeror, they will be deemed to be a single
person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Panel's website at www.thetakeoverpanel.org.uk, including
details of the number of relevant securities in issue, when the
offer period commenced and when any offeror was first identified.
You should contact the Panel's Market Surveillance Unit on +44
(0)20 7638 0129 if you are in any doubt as to whether you are
required to make an Opening Position Disclosure or a Dealing
Disclosure.
Publication on website and hard copies
A copy of this announcement and the documents required to be
published by Rule 26 of the Takeover Code will be available,
subject to certain restrictions relating to persons resident in
Restricted Jurisdictions, on Faroe' website at https://www.fp.fo/
by no later than 12 noon on the Business Day following the date of
this announcement. For the avoidance of doubt, the content of the
website is not incorporated into and does not form part of this
announcement.
Forward Looking Statements
This announcement contains certain statements which are, or may
be deemed to be, "forward-looking statements" which are prospective
in nature. The words "believe", "anticipate", "expect", "intend",
"aim", "plan", "predict", "continue", "assume", "positioned",
"may", "will", "should", "shall", "risk" and other similar
expressions that are predictions of or indicate future events and
future trends identify forward-looking statements. These
forward-looking statements include all matters that are not current
or historical facts. By their nature, forward-looking statements
involve risks and uncertainties because such statements relate to
events and depend on circumstances that may or may not occur in the
future. Forward-looking statements are not indicative of future
performance and Faroe's actual results of operations, financial
condition and liquidity, and the development of the industry in
which Faroe operates, may differ materially from those made in or
suggested by the forward- looking statements contained in this
announcement. The cautionary statements set out above should be
considered in connection with any subsequent written or oral
forward-looking statements that Faroe, or persons acting on its
behalf, may issue.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
MSCDMGGMGFMGLZM
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January 03, 2019 05:45 ET (10:45 GMT)
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