TIDMENQ
RNS Number : 6981P
EnQuest PLC
21 November 2016
THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND DOES NOT CONSTITUTE A
PROSPECTUS OR PROSPECTUS EQUIVALENT DOCUMENT. NOTHING HEREIN SHALL
CONSTITUTE AN OFFERING OF HIGH YIELD NOTES, RETAIL NOTES OR NEW
ORDINARY SHARES. ANY DECISION TO PURCHASE, SUBSCRIBE FOR, OTHERWISE
ACQUIRE, SELL OR OTHERWISE DISPOSE OF ANY NEW HIGH YIELD NOTES,
EXISTING RETAIL NOTES, AMED RETAIL NOTES OR NEW ORDINARY SHARES
MUST BE MADE ONLY ON THE BASIS OF THE INFORMATION CONTAINED IN AND
INCORPORATED BY REFERENCE INTO THE PROSPECTUS OR THE EXPLANATORY
STATEMENT (AS APPLICABLE). COPIES OF THE EXPLANATORY STATEMENT HAVE
BEEN DISTRIBUTED ELECTRONICALLY AND ARE AVAILABLE UPON REQUEST AT
THE OFFICES OF ASHURST LLP, BROADWALK HOUSE, 5 APPOLD STREET,
LONDON EC2A 2AG AND ON THE COMPANY'S INFORMATION AGENT WEBSITE AT
WWW.LUCID-IS.COM/ENQUEST AND THE PROSPECTUS IS AVAILABLE FROM THE
REGISTERED OFFICE OF ENQUEST PLC AND (SUBJECT TO CERTAIN
RESTRICTIONS) ON ITS WEBSITE AT WWW.ENQUEST.COM.
THE NEW ORDINARY SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE US SECURITIES ACT OF 1933, AS AMED (THE "SECURITIES
ACT"), AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT
REGISTRATION OR AN APPLICABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE NEW ORDINARY SHARES WILL
NOT BE REGISTERED UNDER THE SECURITIES ACT AND WILL NOT BE OFFERED
OR SOLD TO THE PUBLIC IN THE UNITED STATES.
THE NEW HIGH YIELD NOTES TO BE ISSUED PURSUANT TO THE SCHEME
HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT
AND WILL BE ISSUED IN RELIANCE UPON THE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT PROVIDED BY SECTION
3(a)(10) THEREOF.
EnQuest PLC, 21 November 2016
Completion of the financial restructuring of EnQuest PLC
Overview
The Board of EnQuest PLC (the "Company") is pleased to announce
that the financial restructuring of the Group (the "Restructuring")
announced on 13 October 2016 has now become effective. This
announcement concludes the Restructuring and constitutes the final
stage in the process.
The Restructuring comprises the implementation of the RCF
Amendments, the Note Amendments, the renewal of the Surety Bond
Facilities and the Placing and Open Offer (each as defined and
described in further detail below).
The completion of the Restructuring provides the Group with a
stable and sustainable capital structure, reduced cash debt service
obligations and greater liquidity. These will all contribute to
ensuring that the Group is in a strong position to pursue its
strategy of targeting mature and marginal oil assets and its focus
on cost efficiency during a prolonged period of low oil prices. In
particular, the Restructuring will enable the Group to complete the
Kraken and Scolty/Crathes developments, which the Company expects
will lead to both significant increases in production and
significant decreases in average unit operating costs across the
Group.
Jock Lennox, Chairman of EnQuest, said:
"EnQuest is very pleased to announce today the successful
completion of the financial restructuring proposals announced on 13
October, a comprehensive package of measures designed to place
EnQuest on a strong footing to deliver the Kraken development in H1
2017 and to ensure that EnQuest is well placed to deliver value to
shareholders in the medium term."
Amjad Bseisu, Chief Executive of EnQuest, said:
"We have been delighted at the level of support received for
EnQuest's capital restructuring; with 100% backing from our
revolving credit facility lenders and hedging banks, 99.9% of votes
being cast in favour of the Scheme by the scheme creditors, 98.9%
of shareholder votes being cast in favour of EnQuest's general
meeting resolutions and backing from all of our surety bonds
providers.
This restructuring will significantly improve EnQuest's
liquidity position, ensuring that we are well positioned for the
future, including delivering first oil from the Kraken development,
with its unit operating costs expected to be in the low $20s per
barrel once it is fully on-stream."
Overview of the Restructuring
The key features of the Restructuring are:
RCF Amendments
Key amendments (the "RCF Amendments") to the Group's existing
revolving credit facility (the "Existing RCF") which were approved
by all of the lenders under the Existing RCF and all of the Group's
hedging banks to, among other things:
-- extend of the final maturity date to October 2021;
-- split the maximum aggregate commitments into a $1,125 million
term loan facility and a $75 million revolving credit facility,
amend the margin on each of the facilities and cancel the existing
accordion feature;
-- amend the amortisation profile;
-- relax certain of the financial covenants; and
-- incorporate terms to allow for new super senior hedging.
Note Amendments
Key amendments to the High Yield Notes and the Retail Notes (the
"Note Amendments") which were implemented by an English scheme of
arrangement (the "Scheme") with the approval of 99.87% in value and
99.90% in number of the noteholders voting on the Scheme and which
became effective today (being the Restructuring Effective Date, as
defined in the Scheme) to, among other things:
-- add conditions to the payment of interest in cash based on,
amongst other things, the average prevailing oil price (dated Brent
future (as published by Platts)) for the six month period
immediately preceding the day which is one month prior to the
relevant interest payment date being at least $65.00/bbl; otherwise
interest payable is to be capitalised;
-- amend the maturity dates of the High Yield Notes and the
Retail Notes to April 2022, with an option exercisable by the
Company (at its absolute discretion) to extend the maturity date by
one year and an automatic further extension of the maturity date to
October 2023 if the Existing RCF is not fully repaid or refinanced
by October 2020; and
-- amend certain of the financial indebtedness baskets under the
High Yield Notes, remove the financial covenants under the Retail
Notes, add new cross default provisions and restrict the Company
from paying any dividend or distribution on any class of its shares
until it has repaid or redeemed all capitalised interest (if any)
accruing on the Notes in cash at par, together with any accrued but
unpaid interest thereon.
Pursuant to the Scheme, the amendments to the High Yield Notes
will be effected through a dollar-for-dollar exchange for new High
Yield Notes (the "New High Yield Notes"). Interest due but not paid
on the High Yield Notes prior to completion of the Restructuring
will be capitalised and added to the principal amount of the New
High Yield Notes. Accordingly, the aggregate principal amount of
the New High Yield Notes will be US$677,482,000. The Company
expects to issue the New High Yield Notes (and to cancel the High
Yield Notes) during the course of today. Furthermore, the Company
expects that the New High Yield Notes will be admitted to listing
on the Official List of the Luxembourg Stock Exchange and to
trading on the Euro MTF Market of the Luxembourg Stock Exchange as
soon as practicable after issuance.
The amendments to the Retail Notes have been effected today by
way of amendment to the existing Retail Notes.
Surety Bond Facilities renewal
The Group's surety bond providers (who provide instruments
covering certain decommissioning security obligations) have agreed
to renew the Surety Bond Facilities for rolling periods of 12
months until the end of 2018 (with renewal in 2017 conditional on
there being no relevant default at the time).
Completion of the Placing and Open Offer
The Company also today announced the completion of the Placing
and Open Offer, pursuant to which the Company has raised gross
aggregate proceeds of GBP82 million.
It is intended that the proceeds of the Placing and Open Offer
will be applied by the Group to:
-- continue the development of the Group's Kraken asset with the
aim of achieving first oil in the first half of 2017;
-- continue the development of the Group's Scolty/Crathes asset; and
-- provide general corporate and working capital for the Group.
The Company does not intend to use proceeds from the Placing and
Open Offer to repay bank debt.
The New Ordinary Shares issued by the Company pursuant to the
Placing and Open Offer were (i) admitted to listing on the premium
listing segment of the Official List and to trading on the London
Stock Exchange plc's main market for listed securities and (ii)
admitted to trading on NASDAQ Stockholm in each case earlier
today.
Enquiries
EnQuest PLC Tel: +44 (0)20 7925 4900
Amjad Bseisu (Chief Executive)
Jonathan Swinney (Chief Financial Officer)
Michael Waring (Head of Communications & Investor
Relations)
Restructuring Adviser Tel: +44 (0)20 7280 5000
Rothschild
IMPORTANT NOTICE
This announcement has been issued by and is the sole
responsibility of EnQuest. The information contained in this
announcement is for background purposes only and does not purport
to be full or complete. No reliance may or should be placed by any
person for any purpose whatsoever on the information contained in
this announcement or on its accuracy or completeness. The
information in this announcement is subject to change.
Copies of the Explanatory Statement have been distributed
electronically and are available upon request at the offices of
Ashurst LLP, Broadwalk House, 5 Appold Street, London EC2A 2AG and
on the Company's information agent website at
www.lucid-is.com/enquest and copies of the Prospectus have been
published and are available from the registered office of EnQuest
and, subject to certain restrictions, on EnQuest's website at
www.enquest.com. The Prospectus is not, subject to certain
exceptions, available (through the website or otherwise) to
Shareholders and prospective investors in the United States,
Australia, Canada, Japan and the Republic of South Africa. Neither
the content of EnQuest's website nor any site accessible by
hyperlinks on EnQuest's website is incorporated in, or forms part
of, this announcement. The Explanatory Statement provides further
details of the Scheme and Prospectus provides further details of
the New Ordinary Shares being offered pursuant to the Placing and
Open Offer.
This announcement does not contain or constitute an offer to
sell or the solicitation of an offer to purchase securities to any
person with a registered address in, or who is resident in, any
Excluded Territory or in any jurisdiction in which such an offer or
solicitation is unlawful. None of the securities referred to herein
have been or will be registered under the relevant laws of any
state, province or territory in any Excluded Territory.
The New Ordinary Shares have not been and will not be registered
under Securities Act, and may not be offered or sold in the United
States absent registration or an applicable exemption from the
registration requirements of the Securities Act. The New Ordinary
Shares will not be registered under the Securities Act and will not
be offered or sold to the public in the United States.
The New High Yield Notes to be issued pursuant to the Scheme
have not been and will not be registered under the Securities Act
and will be issued in reliance upon the exemption from the
registration requirements of the Securities Act provided by section
3(a)(10) thereof.
This announcement is for information purposes only and is not
intended to and does not constitute or form part of any offer or
invitation to purchase or subscribe for, or any solicitation to
purchase or subscribe for, any securities in any jurisdiction. No
offer or invitation to purchase or subscribe for, or any
solicitation to purchase or subscribe for, any securities will be
made in any jurisdiction in which such an offer or solicitation is
unlawful.
This announcement has been prepared in accordance with English
law, the EU Market Abuse Regulation and the Disclosure Guidance
Rules and Transparency Rules of the Financial Conduct Authority and
information disclosed may not be the same as that which would have
been prepared in accordance with the laws of jurisdictions outside
England.
The distribution of this announcement into jurisdictions other
than the United Kingdom and Sweden may be restricted by law, and,
therefore, persons into whose possession this announcement comes
should inform themselves about and observe any such restrictions.
Any failure to comply with any such restrictions may constitute a
violation of the securities laws of such jurisdiction.
Recipients of this announcement and/ or the Explanatory
Statement and/or the Prospectus should conduct their own
investigation, evaluation and analysis of the business, data and
property described in this announcement and/or the Prospectus
and/or the Explanatory Statement. This announcement does not
constitute a recommendation concerning any investor's options with
respect to the Restructuring. The price and value of securities can
go down as well as up. Past performance is not a guide to future
performance. The contents of this announcement are not to be
construed as legal, business, financial or tax advice. Each
investor or prospective investor should consult his, her or its own
legal adviser, business adviser, financial adviser or tax adviser
for legal, financial, business or tax advice.
Notice to all investors
N M Rothschild & Sons Limited ("Rothschild"), which is
authorised and regulated by the Financial Conduct Authority in the
United Kingdom, is acting for EnQuest solely in the capacity of
financial advisor to the Restructuring. Rothschild will not be
responsible to anyone other than EnQuest for providing the
protections afforded to clients of Rothschild nor for providing
advice in relation to the Restructuring.
Apart from the responsibilities and liabilities, if any, which
may be imposed upon Rothschild by the FSMA, Rothschild does not
accept any responsibility or liability whatsoever and makes no
representation or warranty, express or implied, for the contents of
this announcement, including its accuracy, fairness, sufficiency,
completeness or verification or for any other statement made or
purported to be made by it, or on its behalf, in connection with
EnQuest or the Restructuring and nothing in this announcement is,
or shall be relied upon as, a promise or representation in this
respect, whether as to the past or future. Rothschild accordingly
disclaims to the fullest extent permitted by law all and any
responsibility and liability whether arising in tort, contract or
otherwise (save as referred to above) which it might otherwise have
in respect of this announcement or any such statement. Rothschild
provides financial advisory services to EnQuest from time to
time.
No person has been authorised to give any information or to make
any representations other than those contained in this announcement
and the Prospectus and, if given or made, such information or
representations must not be relied on as having been authorised by
EnQuest or Rothschild. Subject to the Listing Rules, the Prospectus
Rules and the Disclosure Guidance and Transparency Rules of the
Financial Conduct Authority, the issue of this announcement shall
not, in any circumstances, create any implication that there has
been no change in the affairs of EnQuest since the date of this
announcement or that the information in it is correct as at any
subsequent date.
Cautionary statement regarding forward-looking statements
This announcement may contain certain forward-looking
statements, beliefs or opinions, with respect to the financial
condition, results of operations and business of EnQuest and the
Group.
This announcement includes statements that are, or may be deemed
to be, "forward-looking statements". The words "believe",
"estimate", "target", "anticipate", "expect", "could", "would",
"intend", "aim", "plan", "predict", "continue", "assume",
"positioned", "may", "will", "should", "shall", "risk", their
negatives and other similar expressions that are predictions of or
indicate future events and future trends identify forward-looking
statements. An investor should not place undue reliance on
forward-looking statements because they involve known and unknown
risks, uncertainties and other factors that are in many cases
beyond the Company's or the Group's control. By their nature,
forward-looking statements involve risks and uncertainties because
they relate to events and depend on circumstances that may or may
not occur in the future. The Company cautions investors that
forward-looking statements are not guarantees of future performance
and that its actual results of operations and financial condition,
and the development of the industry in which it operates, may
differ materially from those made in or suggested by the
forward-looking statements contained in this announcement and/or
information incorporated by reference into this announcement. In
addition, even if the Company's or the Group's results of
operation, financial position and growth, and the development of
the markets and the industry in which the Group operates, are
consistent with the forward-looking statements contained in this
announcement, these results or developments may not be indicative
of results or developments in subsequent periods. The cautionary
statements set forth above should be considered in connection with
any subsequent written or oral forward-looking statements that the
Company, or persons acting on its behalf, may issue.
Past performance of the Company cannot be relied on as a guide
to future performance. As a result, you are cautioned not to place
undue reliance on such forward-looking statements. A variety of
factors may cause the Company's or the Group's actual results to
differ materially from the forward-looking statements contained in
this announcement. Forward-looking statements speak only as of
their date and the Company, its parent and subsidiary undertakings,
the subsidiary undertakings of such parent undertakings, Rothschild
and any of such persons' respective directors, officers, employees,
agents, affiliates or advisers expressly disclaim any obligation to
supplement, amend, update or revise any of the forward-looking
statements made herein, except where it would be required to do so
under applicable law.
No statement in this announcement is intended as a profit
forecast or a profit estimate and no statement in this announcement
should be interpreted to mean that earnings per share of EnQuest
for the current or future financial years would necessarily match
or exceed the historical published earnings per share of
EnQuest.
This information is provided by RNS
The company news service from the London Stock Exchange
END
REPAKDDKCBDKNDB
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