The Boards of Rift Oil PLC and Talisman Energy have reached an agreement on the terms of the recommended proposals for Talisman Holdings to acquire the entire issued and to be issued share capital of Rift for 13 pence per Rift Share.
The Acquisition will be made on the following basis:
13 pence in cash for each Rift Share.
• The Acquisition represents a premium of approximately:
- 30.0 per cent. to the Closing Price of 10.0 pence per Rift Share on 15 June 2009, being the last Business Day prior to this announcement;
- 39.1 per cent. to the average Closing Price of approximately 9.3 pence per Rift Share over the 30 day trading period ended 15 June 2009; and
- 72.8 per cent. to the average Closing Price of approximately 7.5 pence per Rift Share over the three month trading period ended 15 June 2009.
• The terms of the Acquisition value Rift’s existing issued share capital at approximately £108.0 million and, on a fully diluted basis, at approximately £114.8 million.
• The Rift Directors consider the terms of the Acquisition to be fair and reasonable and intend unanimously to recommend that Rift Shareholders vote in favour of the Scheme Resolutions.
• Talisman Holdings has received irrevocable undertakings to vote in favour of the Scheme Resolutions in respect of a total of 268,564,851 Rift Shares representing, in aggregate, approximately 32.3 per cent. of the existing issued share capital of Rift, comprised as follows:
(a) from each of the Rift Directors and certain of their connected persons in respect of, in aggregate, 136,779,246 Rift Shares, representing approximately 16.5 per cent. of the existing issued share capital of Rift. These undertakings will continue to be binding even if a competing offer is made for Rift which exceeds the value of the Acquisition and even if such higher offer is recommended for acceptance by the Board of Rift; and
(b) from certain other Rift Shareholders in respect of, in aggregate, 131,785,605 Rift Shares, representing approximately 15.9 per cent. of the existing issued share capital of Rift. These undertakings will continue to be binding even if a competing offer is made for Rift unless such competing offer represents an improvement of not less than 10 per cent. on the value of the Acquisition.
• The Directors of Rift, who have been so advised by Seymour Pierce, consider that the terms of the Acquisition are fair and reasonable. In providing its advice, Seymour Pierce has taken into account the commercial assessments of the Directors.
The Acquisition will be implemented by way of a scheme of arrangement under Part 26 of the Act and in order to approve the terms of the Acquisition, Rift Shareholders will need to vote in favour of the Scheme Resolutions to be proposed at two meetings of Shareholders (the Court Meeting and the General Meeting) which are expected to be convened and held in July 2009. It is anticipated that a Scheme Document containing the notice of the two meetings will be sent to Rift Shareholders in late June 2009 following a hearing of the Court application to convene the Court Meeting. Talisman Holdings has, however, reserved the right to implement the Acquisition by way of an Offer.
The Acquisition is also conditional on, amongst other things:
• there being no legally binding agreement or arrangement with any third party relating to the sale, transfer, disposal, farm out, earn out, carry or similar of any interest in relation to either licence PPL 235 or PPL 261; and
• licence PPL 235, which expires on 28 August 2009, being extended on terms reasonably satisfactory to Talisman Holdings.
The Board of Rift has confirmed to Talisman that all discussions relating to the possible farm out announced on 5 May 2009 have now ceased.
Commenting on the Acquisition, Paul Blakeley, Executive Vice President, International Operations (East), of Talisman, said:
“Talisman believes this offer represents the full and fair value of the assets and provides Rift shareholders the certainty of cash. The acquisition will provide a low-cost opportunity to aggregate gas in Southeast Asia, one of the growth areas of our portfolio”
Ian Gowrie-Smith, Non-Executive Chairman of Rift, said:
“The Board of Rift Oil PLC are pleased that years of investment and hard work have culminated in this offer for the Company at a price that we believe suitably rewards shareholders. It is time for those with more significant resources to take over the challenge of development and commercialisation”
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