Schlumberger Limited, the world’s leading oil and gas industry supplier of technology, is acquiring a minority equity interest in Cayman registered and London Stock Exchange listed Eurasia Drilling Company Limited (EDC). EDC is the largest provider of onshore oil and gas drilling services in Russia.
The agreement extends the successful long-term relationship between EDC and Schlumberger within the strategic alliance the parties signed in 2011. Under the deal, the principal shareholders and senior management of EDC, the participating shareholders, will take the company private. Upon the delisting of EDC from the London Stock Exchange, Schlumberger will acquire a minority equity ownership interest of approximately 45.65% in EDC, in exchange for consideration of USD22 per share.
In addition, the participating shareholders have granted Schlumberger a call option over the remaining 54.35% of EDC shares which becomes exercisable after the third anniversary of closing. The acquisition is being structured as a Cayman Islands law merger between EDC and a company formed by one of the participating shareholders solely for the purposes of the merger. The transaction was negotiated in a very tight timeframe against the challenging backdrop of falling world prices for oil, increasing international pressure on Russia as a result of the Ukraine crisis and the consequential economic and exchange rate volatility in Russia. The deal is expected to close on or around 24 February 2015.
The A&O team in London was led by Jeremy Parr with support from senior associate David Duncan, and in Moscow partner Konnov led with support from associate Yanis Peters.
Corporate partner and Global Co–Head of Energy, Jeremy Parr, commented: “This transaction reinforces our market leading position in complex cross-border Energy M&A.”
Moscow corporate head Anton Konnov commented: “This deal demonstrates, not only that Russia is still very much open for business, but also that companies are still investing in Russia and A&O is in a position to help clients navigate the complex regulatory restrictions and sanctions involved in doing deals in the region.”
Source: www.allenovery.com
