NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE
OR IN PART, IN OR INTO THE UNITED STATES OF AMERICA, AUSTRALIA, CANADA, JAPAN
AND THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH IT WOULD BE
UNLAWFUL TO DO SO. PLEASE SEE THE IMPORTANT NOTICE AT THE END OF THIS
ANNOUNCEMENT.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE MARKET
ABUSE REGULATION (EU NO. 596/2014).
THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND DOES NOT CONSTITUTE A PROSPECTUS OR
PROSPECTUS EQUIVALENT DOCUMENT. NOTHING HEREIN SHALL CONSTITUTE AN OFFERING OF
NEW ORDINARY SHARES, HIGH YIELD NOTES OR RETAIL NOTES. ANY DECISION TO PURCHASE,
SUBSCRIBE FOR, OTHERWISE ACQUIRE, SELL OR OTHERWISE DISPOSE OF ANY NEW ORDINARY
SHARES, NEW HIGH YIELD NOTES, EXISTING RETAIL NOTES OR AMENDED RETAIL NOTES 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) ONCE
PUBLISHED OR DISTRIBUTED ELECTRONICALLY. COPIES OF THE PROSPECTUS WILL,
FOLLOWING PUBLICATION, BE AVAILABLE FROM THE REGISTERED OFFICE OF ENQUEST PLC
AND ON ITS WEBSITE AT WWW.ENQUEST.COM, AND COPIES OF THE EXPLANATORY STATEMENT
WILL, FOLLOWING DISTRIBUTION ELECTRONICALLY, BE 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.
EnQuest PLC, 13 October 2016
Proposed c. £82 million Placing and Open Offer and financial restructuring
**Amendment: Lucid website link has been changed to the correct address**
Overview
The Board of EnQuest PLC today announces the launch of a proposed issuance of
equity, by way of a Placing and Open Offer of, in aggregate, 356,738,114 New
Ordinary Shares at an Issue Price of 23 pence per New Ordinary Share expected to
raise proceeds of approximately £82.0 million (approximately £78.1 million net
of estimated expenses).
The Placing and Open Offer is part of a proposed financial restructuring of the
Group (the “Restructuring”) which the Company has agreed with its key
stakeholders following an extensive period of engagement and negotiation.
The aggregate number of New Ordinary Shares issued under the Placing and Open
Offer comprises of 356,738,114 New Ordinary Shares, of which Irrevocable
Undertakings to take up entitlements under the Open Offer have been received for
42,505,990 New Ordinary Shares from Double A Limited and Capita Trustees
Limited, acting in their capacity as trustees of the EnQuest EBT and 314,232,124
New Ordinary Shares are to be conditionally placed (subject to clawback to
satisfy valid applications by Qualifying Shareholders under the Open Offer) with
Placees during the Bookbuild.
A Bookbuild will open with immediate effect. The timing of the closing of the
Bookbuild is at the discretion of J.P. Morgan Cazenove and BofA Merrill Lynch,
following consultation with the Company. Details of the allocation of New
Ordinary Shares will be confirmed to Placees as soon as practicable after the
close of the Bookbuild.
The Restructuring is comprised of a number of key elements, including the
implementation of the Proposed RCF Amendments and the Proposed Note Amendments,
the renewal of the Surety Bond Facilities and the Placing and Open Offer (which
terms are explained further below). All of these elements are inter-conditional,
meaning that none of the elements will become effective if any one of them is
not delivered. So the Restructuring would not proceed if for example, the Scheme
to effect the Proposed Note Amendments is not approved by the requisite
majorities of Scheme Creditors or if the shareholder Resolutions in connection
with the Placing and Open Offer are not approved by Shareholders.
The Company believes that, if successful, the Restructuring will provide the
Group with a stable and sustainable capital structure, reduced cash debt service
obligations and greater liquidity. These will all contribute to the continued
delivery by the Group of its strategic objectives.
The proceeds of the Placing and Open Offer will be used to continue the
development of the Company's Kraken asset with the aim of achieving first oil in
the first half of 2017; continue the development of the Company's Scolty/Crathes
asset; and provide general corporate and working capital for the Company. The
Company does not intend to use any proceeds from the Placing and Open Offer to
repay bank debt.
Jock Lennox, Chairman of EnQuest, said:
“We are very pleased to announce today a comprehensive package of measures to
place EnQuest on a strong footing to deliver our Kraken development in H1 2017
and ensure that we are well placed to deliver value to our shareholders in the
medium term.
Over the last two years, EnQuest has taken action to implement extensive cost
saving programmes to refocus the business for the low oil price environment,
including reducing and re-phasing both capital and operating expenditures.
Simultaneously, EnQuest has been working on a range of other funding and
liquidity options, which culminate in the Restructuring announced today. We have
agreed a range of improvements on the terms of our debt facilities and we remain
grateful to our RCF lenders for their continuing support. We have also reached
agreement with approximately 61 per cent of our High Yield Noteholders on the
Proposed Note Amendments.
The proposed Restructuring, which encompasses amendments to EnQuest’s existing
RCF facility, amendments to the High Yield Notes and the Retail Notes, the
renewal of the Company’s Surety Bond Facilities and the Placing and Open Offer
which is expected to raise £82 million in gross proceeds, will significantly
improve the liquidity position of the Company so that EnQuest can deliver first
oil from the Kraken development in H1 2017 in accordance with management’s
projections. The Kraken development continues to be on track with the FPSO set
for sail away in H2 2016.
The Board remains confident in the long term potential of the EnQuest business
plan, and is of the view that the proposed Restructuring, including the Placing
and Open Offer, will enhance value for all stakeholders.”
Overview of the Restructuring
The key features of the Restructuring are:
Proposed RCF Amendments
· Certain amendments to the Existing RCF (the “Proposed RCF Amendments”), to,
amongst other things:
· extend the final maturity date of the Existing RCF to October 2021;
· split the maximum aggregate commitments into a term loan facility and a
revolving credit facility, amend the margin on each of the facilities and cancel
the existing accordion feature;
· amend the Existing RCF amortisation profile;
· relax certain of the financial covenants in the Existing RCF; and
· incorporate terms to allow for new super senior hedging.
· All of the Existing RCF Lenders and all of the Group's Hedging Banks have
locked-up to support the Restructuring by entering into a formal agreement (the
"Lock-up Agreement") pursuant to which they have agreed to, among other things,
vote in favour of the Proposed RCF Amendments.
Proposed Note Amendments
· Certain amendments to the High Yield Notes and the Retail Notes (the
“Proposed Note Amendments”) are being proposed to, amongst other things:
· add a condition to 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.
· The Proposed Note Amendments will be effected through an English scheme of
arrangement (the “Scheme”), which must be approved by 50 per cent. in number and
75 per cent. in value of Scheme Creditors attending and voting at a meeting
convened with the permission of the English Court to consider the Scheme (the
“Scheme Meeting”). The High Yield Noteholders and the Retail Noteholders will
form a single class of creditors for the purpose of voting on the Scheme and
further information has been provided to each of them today with further detail
on the proposed terms of, and significant dates in relation to, the Scheme. As
noted above, all of the elements of the Restructuring are inter-conditional,
meaning that the Scheme will not become effective unless each of the other
elements of the Restructuring are approved and/or completed. In addition, the
Scheme is subject to the Company obtaining recognition of the Scheme under
chapter 15 of Title 11 of the United States Code.
· High Yield Noteholders representing approximately 61 per cent. of the High
Yield Notes have locked-up to support the Restructuring by entering into the
Lock-up Agreement, pursuant to which they have agreed to, among other things,
attend the Scheme Meeting in person or by proxy and to vote in favour of the
Proposed Note Amendments. These High Yield Noteholders have also agreed not to
take any enforcement action in relation to the interest payment due in respect
of the High Yield Notes on 17 October 2016.
· Due to the diverse nature of the holdings of the Retail Notes it was not
possible for the Company to approach all Existing Retail Note Holders in
advance, but the Restructuring proposal has been considered by a number of
significant Existing Retail Noteholders approached by the Company on a
confidential basis. The feedback from such Existing Retail Noteholders was very
positive and the sample indicated support for the Restructuring from
professional investors.
Renewal of Surety Bond Facilities
· The Group's Surety Bond Providers (who provide instruments covering certain
decommissioning security obligations) have agreed to renew the Surety Bond
Facilities for a period of two years to the end of 2018 (with renewal in 2017
conditional on there being no relevant default at the time), provided that the
other elements of the Restructuring are completed.
Placing and Open Offer
· The Company proposes to raise aggregate gross proceeds of approximately
£82.0 million (equivalent to SEK 884 million at exchange rate of SEK 1.00 = GBP
0.0928, or approximately $100 million at an exchange rate of US$1.00 = GBP
0.8199, each on 12 October 2016), before expenses, of additional equity capital
pursuant to the Placing and Open Offer.
· The Issue Price of 23 pence / SEK 2.48 represents a discount of 17.1 per
cent. and 17.9 per cent. to the closing middle market price on the London Stock
Exchange and NASDAQ Stockholm respectively on 12 October 2016 (being the last
trading day prior to the announcement of the Placing and Open Offer).
· Open Offer ratio of 4 New Ordinary Shares for every 9 Existing Ordinary
Shares.
· It is expected that all of the Open Offer Shares (other than the Committed
Shares) will be conditionally placed (subject to clawback to satisfy valid
applications by Qualifying Shareholders under the Open Offer) with Placees
pursuant to the Placing by way of the Bookbuild (as described further below).
· Double A Limited, a company beneficially owned by the extended family of
Amjad Bseisu, is proposing to participate in the Placing and Open Offer. Double
A Limited has irrevocably undertaken to participate in the Open Offer by taking
up 31,735,702 New Ordinary Shares representing £7.3 million (approximately $8.9
million), being its pro rata share of the amount to be raised in the Open Offer.
In addition, Double A Limited has committed to participate in the Placing
(subject to clawback to satisfy valid applications under the Open Offer and
Scale Back) on a dollar for dollar basis against the total number of New
Ordinary Shares which Existing Shareholders commit to subscribe for as part of
the Placing on a pro rata basis, up to a maximum of £33.7 million ($41.1
million). Double A Limited’s participation in the Placing is currently expected
to be £20.4 million ($24.9 million), with the final amount being determined
following completion of the Bookbuild. On that basis, prior to any clawback to
satisfy valid applications under the Open Offer and Scale Back, Double A
Limited’s total commitment in the Placing and Open Offer would be £27.7 million
($33.8 million).
Background to and reasons for the Restructuring proposal
The decline in oil prices since 2014 and the continuing challenging oil price
environment have had a significant negative impact on the Group's revenues,
liquidity and available cash resources.
In response to the decline in oil prices, the Group has set a number of
strategic priorities, including delivering on execution, streamlining operations
and strengthening the Group's balance sheet. The Group has continued to focus on
delivering a strong operational performance and has also taken a number of
additional measures to address the impact of the decline in oil prices and the
Group's cash flow constraints, including the following:
· Negotiating the relaxation of certain financial covenants in the Existing
RCF and the Retail Notes
· Engaging in commodity hedging activities
· Divesting non-core assets
· Reducing operating costs
· Reducing capital expenditure on the Kraken development
· Improving future cash flows through the development of Kraken and
Scolty/Crathes
· Deferring certain trade creditor obligations
These measures have been significant steps in maintaining the Group's viability
in the current environment. However, a longer term solution is needed to
strengthen the Group's liquidity position, to reduce the burden of the Group's
cash debt service obligations and in order for the Group to continue pursuing
its business strategy and, in particular, to bring Kraken to first oil.
As noted above, these elements of the Restructuring are inter-conditional,
meaning that none of the elements will become effective if, for example, the
Scheme to effect the Proposed Note Amendments is not approved by the requisite
majorities of Scheme Creditors or if the shareholder Resolutions in connection
with the Placing and Open Offer are not approved by Shareholders.
The Restructuring has the support of stakeholders across the Group’s capital
structure:
· all of the Existing RCF Lenders have locked-up to support the
Restructuring, including by voting in favour of the Proposed RCF Amendments;
· all of the Group's hedging banks (the "Hedging Banks") have locked-up to
support the Restructuring, including by voting in favour of the Proposed RCF
Amendments;
· holders representing approximately 61 per cent. in aggregate principal
amount of the High Yield Notes (the holders of the High Yield Notes, the "High
Yield Noteholders") have locked-up to support the Restructuring, including by
voting in favour of the Scheme (as defined below) to effect the Proposed Note
Amendments (as defined below) and by agreeing not to take any enforcement action
in relation to the interest payment due in respect of the High Yield Notes on 17
October 2016;
· due to the diverse nature of the holdings of the Retail Notes it was not
possible for the Company to approach all Existing Retail Note Holders in
advance, but the Restructuring proposal has been considered by a number of
significant Existing Retail Noteholders approached by the Company on a
confidential basis; the feedback from such Existing Retail Noteholders was very
positive and the sample indicated support for the Restructuring from
professional investors; and
· the Company has received the support of its surety bonds providers, who
have agreed to renew the Surety Bond Facilities subject to the successful
completion of the Restructuring.
Please see below the anticipated key transaction dates (a more detailed
timetable is included in Appendix II):
· 14 November 2016: Shareholder General Meeting
· 14 November 2016: Scheme Meeting
· 16 November 2016: Open Offer Period ends
· 16 November 2016: Scheme sanction hearing
· 17 November 2016: Chapter 15 recognition obtained. Results of Placing and
Open Offer (allocations confirmed to investors)
· 21 November 2016: Restructuring becomes effective. Settlement of newly
issued shares (T+2) – Transaction close
Current trading and future prospects, including trend information
Since 30 June 2016, the date of the Group’s most recent unaudited interim
financial statements, the Group has delivered against its strategic priorities
in the continuing lower price environment. Further action to reduce operating
and capital expenditure has been accompanied by sustained strength in
operations.
The Group announced in September 2016 that as a result of the further phasing of
milestone payments and despite additional capital expenditure on drilling the
Eagle discovery it was expecting to reduce full year 2016 cash capital
expenditure by approximately $30 million. The Kraken and Scolty/Crathes
development projects are continuing ahead of budget; the Kraken FPSO is on track
for sail away in the second half of 2016 and for first oil in H1 2017. In
October 2016, the Group is now reducing its gross full cycle capital expenditure
estimate for Kraken by approximately a further $100 million, down to
approximately $2.5 billion, mainly as a result of better performance on drilling
and subsea production systems. The Kraken FPSO is very close to mechanical
completion, with the focus now on pre-commissioning and commissioning
activities. All four engines and boilers are mechanically complete. The latest
reductions in the overall full cycle gross capex estimates for Kraken reduce
EnQuest’s 2016 net cash capital expenditure by a further $50 million, now down
to between $620 million and $670 million. The Scolty/Crathes development is also
ahead of schedule, with first oil expected to be delivered around the end of
2016. Average production guidance for the full year 2016 continues to be in the
range of 42,000 Boepd to 44,000 Boepd. Unit operating expenditure for the first
half of 2016 was $23/bbl, ahead of target. The Company anticipates full year
unit operating expenditure around the lower end of the $25-$27/bbl guidance for
the full year 2016. The Company continues to seek cost reductions across the
supply chain.
Substantial works have continued on Alma/Galia. The K1 (AP4) well required a
chemical treatment which has been successful and the workover of the K3z (AP1)
well, was carried out by early August, further increasing production. The
drilling of well K7, the replacement for the uncompleted K6, is in progress,
with completion operations underway. K7 should be online around the 2016 year
end. On GKA, the planned shutdown during the second half of the year was
delivered securely and successfully.
In line with its internal financial policies, the Group has continued to enter
into hedging arrangements. Since 30 June 2016, the Group has hedged 1MMbbl of
2017 production (83kbbls/month) at a fixed price of $51.50. The Group has also
sold 500,000 bbls per month for the first half of 2017 (3 MMbbls total) at a
fixed price of $49/bbl and has bought a call (nil cost) for the same notional
quantity, with a strike at $57.25. Should the price rise above $57.25, the Group
will receive the difference to offset the loss it would make on the $49/bbl
swaps). In addition, the Group has hedged 500,000 bbls for the first half of
2017 at $54.50.
Update on EnQuest Board Sub-committees
EnQuest also announces the following changes to the Audit and Remuneration
Committees with immediate effect
· Helmut Langanger has joined the Audit Committee; and
· Phil Holland has joined the Remuneration Committee.
Stefan Ricketts, General Counsel and Company Secretary, is arranging release of
this announcement on behalf of the Company.
Unless otherwise defined herein, all capitalised terms used in the body of this
announcement shall have the meaning given to them in Appendix III.
EnQuest PLC
Tel:
+44
Amjad Bseisu (Chief Executive) Jonathan Swinney (Chief Financial Officer)
Michael (0)20
Waring (Head of Communications & Investor Relations)
7925
4900
Sponsor and Joint BookrunnerJ.P. Morgan Cazenove
Tel:
Barry Weir
Jamie +44
RiddellCharles Pretzlik
(0)20
7742
4000
Joint BookrunnerBank of America Merrill
Tel:
Lynch Julian
MylchreestRichard +44
AbelDaniel Norman
(0)20
7628
1000
Restructuring Adviser
Tel:
Rothschild
+44
(0)20
7280
5000
About EnQuest PLC
EnQuest is an oil and gas production and development company focused on turning
opportunities into value by targeting maturing assets and undeveloped oil
fields. EnQuest is the largest independent UK oil producer in the UK North Sea
(as last measured for the twelve months ended 31 May 2016) and had interests in
29 UK production licences, 26 of which the Group operates, covering 41 blocks or
part blocks in the UKCS as of 30 June 2016. In addition, the Group has interests
in Malaysia through its PM8/Seligi Production Sharing Contract and the Tanjong
Baram Risk Service Contract. The Company trades on both the London Stock
Exchange and the NASDAQ OMX Stockholm.
Click on, or paste the following link into your web browser, to view the
associated PDF document.
http://www.rns-pdf.londonstockexchange.com/rns/4823M_-2016-10-13.pdf
IMPORTANT NOTICE
Shareholders should note that the Open Offer is not a rights issue. Qualifying
CREST Shareholders should note that the Open Offer Entitlements will not be
tradeable or listed and that, although the Open Offer Entitlements will be
admitted to CREST and be enabled for settlement, applications in respect of
entitlements under the Open Offer may only be made by the Qualifying Shareholder
originally entitled or by a person entitled by virtue of a bona fide market
claim raised by Euroclear's Claims Processing Unit. Qualifying Non-CREST
Shareholders should note that the Application Form is not a negotiable document
and cannot be traded. Qualifying Swedish Shareholders should note that they will
not receive Open Offer Entitlements and Qualifying Swedish Directly Registered
Shareholders should note that neither the Pre-Printed Issue Account Statement or
the Swedish Application Form is a negotiable document and that neither of them
can be traded. Any trading in the Pre-Printed Issue Account Statement or the
Swedish Application Form will be void and any acquirer thereof will have no
rights thereunder.
Qualifying Shareholders should be aware that in the Open Offer, unlike in a
rights issue, any Open Offer Shares not applied for will not be sold in the
market or placed for the benefit of Qualifying Shareholders who do not apply
under the Open Offer, but will be subscribed for under the Placing with the net
proceeds retained for the benefit of the Company and Qualifying Shareholders who
do not apply to take up their Open Offer Entitlements will have no rights under
the Open Offer to receive any proceeds from it.
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.
This announcement is not a prospectus but an advertisement and investors should
not make any decision to purchase, subscribe for, otherwise acquire, sell or
otherwise dispose of any New Ordinary Shares, New High Yield Notes, Existing
Retail Notes or Amended Retail Notes referred to in this announcement except on
the basis of the information contained in the Prospectus to be published by
EnQuest in connection with the Placing and Open Offer to be published or the
Explanatory Statement to be distributed electronically by EnQuest in connection
with the Scheme (as applicable).
Copies of the Prospectus will, following publication, be available from the
registered office of EnQuest and on EnQuest's website at www.enquest.com and the
Explanatory Statement will, following distribution electronically, be 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. 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 website accessible by
hyperlinks on EnQuest's website is incorporated in, or forms part of, this
announcement. The Prospectus will provide further details of the New Ordinary
Shares being offered pursuant to the Placing and Open Offer and the Explanatory
Statement will provide further details of the Scheme.
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. Subject to certain
limited exceptions, none of these materials will be released, published,
distributed or forwarded in or into any Excluded Territory.
This announcement does not contain or constitute an offer for sale or the
solicitation of an offer to purchase securities in the United States. The New
Ordinary Shares have not been and will not be registered under the Securities
Act or under any securities laws of any state or other jurisdiction of the
United States and may not be offered, sold, taken up, exercised, resold,
renounced, transferred or delivered, directly or indirectly, within the United
States except pursuant to an applicable exemption from or in a transaction not
subject to the registration requirements of the Securities Act and in compliance
with any applicable securities laws of any state or other jurisdiction of the
United States. There will be no public offer of the New Ordinary Shares in the
United States.
The New High Yield Notes to be issued pursuant to the Scheme 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. The information
contained in this announcement is not for release, publication or distribution
to persons in the United States or any other Excluded Territory, and should not
be distributed, forwarded to or transmitted in or into any jurisdiction, where
to do so might constitute a violation of local securities laws or regulations.
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. In
particular, subject to certain exceptions, this announcement, the Prospectus
(once published) and the Application Forms should not be distributed, forwarded
to or transmitted in or into the United States or any other Excluded Territory.
Recipients of this announcement and/ or the Prospectus and/or the Explanatory
Statement should conduct their own investigation, evaluation and analysis of the
business, data and property described in this announcement and/or if and when
published the Prospectus and/or if and when distributed electronically the
Explanatory Statement. This announcement does not constitute a recommendation
concerning any investor’s options with respect to the Placing and Open Offer.
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
J.P. Morgan Securities plc (which conducts its UK investment banking services as
“J.P. Morgan Cazenove”) and Merrill Lynch International (“BofA Merrill Lynch”)
are each authorised by the Prudential Regulation Authority and regulated in the
United Kingdom by the Financial Conduct Authority and the Prudential Regulation
Authority. J.P. Morgan Cazenove and BofA Merrill Lynch are acting for EnQuest
and are acting for no one else in connection with the Placing and Open Offer and
will not regard any other person as a client in relation to the Placing and Open
Offer and will not be responsible to anyone other than EnQuest for providing the
protections afforded to their respective clients, nor for providing advice in
connection with the Placing and Open Offer or any other matter, transaction or
arrangement referred to herein.
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 J.P. Morgan Cazenove, BofA Merrill Lynch and Rothschild by the FSMA, J.P.
Morgan Cazenove, BofA Merrill Lynch and/or Rothschild do not accept any
responsibility or liability whatsoever and make 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 New Ordinary Shares or the Placing and Open Offer 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.
Each of J.P. Morgan Cazenove, BofA Merrill Lynch and 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. Each of J.P. Morgan Cazenove and BofA Merrill Lynch and/or their
respective affiliates have from time to time engaged in, and may in future
engage in, various commercial banking, investment banking and financial advisory
transactions and services in the ordinary course of their business with EnQuest.
They have received and will receive customary fees and commissions for these
transactions and services. In addition, an affiliate of BofA Merrill Lynch and
an affiliate of J.P. Morgan Cazenove are lenders under EnQuest’s senior secured
revolving credit facility and each such affiliate may have performed its own
credit analysis on the Company. Rothschild provides financial advisory services
to EnQuest from time to time. EnQuest does not intend to use proceeds from the
Placing and Open Offer to repay bank debt.
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 J.P. Morgan Cazenove, BofA
Merrill Lynch 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, J.P. Morgan Cazenove, BofA
Merrill Lynch and 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.
You are advised to read this announcement and the Prospectus (once published)
and the Explanatory Statement (once distributed electronically) (if relevant) in
their entirety for a further discussion of the factors that could affect
EnQuest's future performance. In light of these risks, uncertainties and
assumptions, the events described in the forward-looking statements in this
announcement may not occur.
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.
Further Information in relation to the Placing and Open Offer
Introduction
The Company announced a proposed capital raise, by way of a Placing and Open
Offer of, in aggregate, 356,738,114 New Ordinary Shares at an Issue Price of 23
pence (2.48 SEK per New Ordinary Share for Qualifying Swedish Shareholders in
the Swedish Open Offer) per New Ordinary Share to raise gross proceeds of
approximately £82.0 million (equivalent to SEK 884 million at exchange rate of
SEK 1.00 = GBP 0.0928 on 12 October 2016) (approximately £78.1 million net of
estimated expenses (equivalent to SEK 842 million at exchange rate of SEK 1.00 =
GBP 0.0928 on 12 October 2016)). The Placing and Open Offer forms part of the
Restructuring announced today following negotiations with relevant stakeholders,
including the Existing RCF Lenders, the Hedging Banks and the Ad Hoc Noteholder
Committee. The key features of the Restructuring are (i) the Placing and Open
Offer; (ii) the Proposed RCF Amendments extending the final maturity date of the
Existing RCF to October 2021, splitting the maximum aggregate commitments into a
term loan facility and a revolving credit facility, amending the amortisation
profile, relaxing certain of the financial covenants in the Existing RCF and
incorporating terms allowing for new super senior hedging; (iii) the Proposed
Note Amendments to be effected by way of an English scheme of arrangement
amending the High Yield Notes and Retail Notes, amongst other things, to provide
that interest will only be payable in cash on any interest payment date if
certain conditions are met (including that the prevailing average oil price is
at least $65.00/bbl for a six-month period, otherwise interest will be
capitalised), to enable the Company (at its absolute discretion) to extend, at
any time, the final maturity dates to April 2023 and automatically to extend the
maturity dates to October 2023 if the Company has not repaid or refinanced the
Existing RCF by 15 October 2020, to remove certain financial covenants from the
Retail Notes, amend certain financial indebtedness baskets in the High Yield
Notes and include a restriction on certain payments to shareholders (and their
affiliates) if the Company has not redeemed in cash the capitalised interest in
respect of the High Yield Notes and the Retail Notes together with any accrued
but unpaid interest thereon; and (iv) the renewal of the Surety Bond Facilities.
Bookbuild
A Bookbuild will open with immediate effect. The timing of the closing of the
Bookbuild is at the discretion of J.P. Morgan Cazenove and BofA Merrill Lynch,
following consultation with the Company.
By choosing to participate in the Placing and by making an oral and legally
binding offer to acquire New Ordinary Shares, investors will be deemed to have
read and understood this announcement in its entirety (including the
Appendices), and to be making such offer on the terms and subject to the
conditions of the Placing contained herein, and to be providing the
representations, warranties and acknowledgements contained in Appendix I.
Allocations
If bids made in the Bookbuild exceed 314,232,124 New Ordinary Shares, the number
of New Ordinary Shares to be subscribed for by Double A Limited in the Placing
may, at the discretion of Double A Limited, be reduced on a “first fill basis”
(“Scale Back”). Details of Double A Limited’s participation in the Placing
following Scale Back will be announced as soon as practicable after the
Bookbuild.
Participation by Double A Limited
Double A Limited, a company beneficially owned by the extended family of Amjad
Bseisu, is proposing to participate in the Placing and Open Offer. As Amjad
Bseisu is a Director of the Company, the participation of Double A Limited in
the Placing constitutes a “related party transaction” for the purposes of
Chapter 11 of the Listing Rules and therefore requires the approval of
Shareholders.
Double A Limited has irrevocably undertaken to take up 31,735,702 New Ordinary
Shares, representing £7.3 million ($8.9 million) in the Open Offer, representing
its pro rata share of the amount to be raised in the Open Offer. In addition,
Double A Limited has committed to participate in the Placing (subject to
clawback to satisfy valid acceptances under the Open Offer and Scale Back) on a
dollar for dollar basis against the total number of New Ordinary Shares which
Existing Shareholders commit to subscribe for as part of the Placing on a pro
rata basis for a maximum of £33.7 million ($41.1 million). Double A Limited’s
participation in the Placing is currently expected to be £20.4 million ($24.9
million), with the final amount being determined following completion of the
Bookbuild. On that basis, prior to any clawback to satisfy valid applications
under the Open Offer and Scale Back, Double A’s total commitment in the Placing
and Open Offer would be £27.7 million ($33.8 million). Without prejudice to its
obligations to subscribe for New Ordinary Shares in the Placing as set out in
this announcement, Double A Limited may enter into back to back or other
arrangements with pre-identified persons and/or the Company, as the case may be,
for the Company to issue to such third parties certain of the New Ordinary
Shares which Double A Limited is required to subscribe for in the Placing
(following clawback in the Open Offer and Scale Back). The New Ordinary Shares
to be subscribed for in the Placing and Open Offer by Double A Limited are not
being underwritten by the Joint Bookrunners.
Background to and reasons for the Placing and Open Offer and the Restructuring
Against the backdrop of challenging market conditions, the Group has achieved a
robust operational performance in its most recent financial periods, as
demonstrated by its increasing production and cost efficiency, as it continues
to pursue its strategy of turning opportunities into value by targeting maturing
assets and undeveloped oil fields and exploiting its existing reserves.
Nevertheless, the decline in oil prices during and since 2014 and the continuing
low oil price environment have had a significant negative impact on the Group's
revenues, liquidity and available cash resources. This situation has been
exacerbated by the Group's level of debt and the significant cash resources
required to service the interest on this debt, as well as by the significant
capital expenditure required for development assets including, in particular,
the Group's Kraken development asset, the Group's largest project to date. These
factors combined have put considerable pressure on the Group's cash flows. As a
result, the Directors are now of the view that, without substantial changes to
the Group's capital and debt structure, the Group will have insufficient cash
resources to bring Kraken to first oil and to meet all of its payment
obligations as they fall due. In particular, if the Placing and Open Offer and
the Restructuring as described in this announcement do not proceed, the
Directors believe that there is a substantial risk that the Group will be unable
to pay the interest payment due in respect of the High Yield Notes on 17 October
2016. If not remedied within the applicable 30 day grace period, and there is no
interest payment standstill agreed by the requisite majority of High Yield
Noteholders (being 90 per cent. or more in value), this would constitute a
default under the High Yield Notes and a cross default under certain of the
Group's other debt instruments and facilities, including the Existing RCF and
the Retail Notes. In addition, the Group has, since January 2015, obtained
waivers from the Existing RCF Lenders in respect of the liquidity covenant
contained in the Existing RCF and the current waiver from this covenant expires
on 31 December 2016. To the extent the Group is unable to improve its liquidity
position or obtain further waivers from the Existing RCF Lenders, the Group
could fail to meet the liquidity covenant in the Existing RCF when next tested
on 31 December 2016 or on a subsequent test date, which would constitute an
event of default under the Existing RCF. In either of these circumstances, there
is a risk that the Company and/or its subsidiaries may become subject to
enforcement action which if not terminated or withdrawn could result in the
majority Existing RCF Lenders appointing an administrator to the Company, with a
view to the administrator commencing (and/or continuing, if already commenced by
the Company at such time) a marketing process for the sale of the Group on an
accelerated basis. However, the Ad Hoc Noteholder Committee may propose an
alternative debt restructuring and seek to engage in negotiations with the
Existing RCF lenders and the Company (which may involve providing a standstill
of the October Interest Payment if the requisite majority has approved such
standstill) and the Existing RCF Lenders may or may not accept such proposal or
may consider such proposal in the context of the sales process.
Although the Group has already undertaken a number of measures to mitigate the
impact of the low oil price environment (as described further below), the
Directors believe that in order to continue its operations as currently
envisioned the Group must strengthen its balance sheet, reduce the impact of the
Group's current debt on its cash flows and increase the Group's cash resources.
The Directors are therefore proposing the Restructuring, of which the Placing
and Open Offer forms an integral part, and are recommending that Shareholders
approve the Resolutions required to complete the Placing and Open Offer. The
Directors expect that the proceeds of the Placing and Open Offer will enable the
Group to complete the developments of Kraken and Scolty/Crathes, which the
Directors expect will lead to both significant increases in production and
significant decreases in average operating costs across the Group. The Directors
believe that the completion of the Restructuring, including the Placing and Open
Offer, will put the Group in a stronger position to meet current oil market
conditions, as they continue to believe that the Group's fundamental business,
with its strategy of targeting mature and marginal oil assets and its focus on
cost efficiency, is well placed to withstand a prolonged period of low oil
prices, and will be even better placed to do so after completion of the Kraken
development.
The recent significant decline in oil prices began in the second half of 2014,
with the average realised price for the Group's UKCS and Malaysian oil sales
(excluding hedging) together decreasing from $100.6 per barrel for the year
ended 31 December 2014 to $50.9 per barrel for the year ended 31 December 2015,
and from $58 per barrel for the six months ended 30 June 2015 to $41 per barrel
for the six months ended 30 June 2016. The Brent crude oil benchmark (which is
the benchmark against which the Group's UKCS production is priced) reached a low
of $27.88/bbl on 20 January 2016. Although oil prices have stabilised somewhat,
they remain significantly below the levels that prevailed in 2013 and the first
half of 2014 (with the Brent crude oil benchmark at a high of $118.9 on 8
February 2013). The Brent crude oil benchmark was $51.7/bbl as of 12 October
2016.This reduction in oil prices has had a negative impact on the Group's
revenues and cash flows from operating activities.
In response to the decline in oil prices, the Group has set a number of
strategic priorities, including delivering on execution, streamlining operations
and strengthening the Group's balance sheet. The Group has continued to focus on
delivering a strong operational performance, as demonstrated by the 31.1 per
cent. increase in the Group's net daily average production in 2015 and a 43.3
per cent. increase in net daily average production in the six months ended 30
June 2016 (compared to the same period in the prior year) and reduced operating
costs described in more detail below. The Group has also taken a number of
additional measures to address the impact of the decline in oil prices and the
Group's cash flow constraints, including the following:
· Negotiating amendments to certain financial covenants in the Existing RCF
and the Existing Retail Notes: In January 2015, the Group negotiated temporary
amendments to certain of its financial covenants in the Existing RCF, raising
the net debt/EBITDA covenant to five times and reducing the ratio of EBITDA to
financing charges to a minimum of three times, both until mid-2017, providing
the Group with additional headroom in the low oil price environment. In May
2015, following approval by the holders of the Existing Retail Notes, the
financial covenants in the Existing Retail Notes were amended for consistency
with the amendments to the Existing RCF. The Company is seeking further changes
to the Existing RCF and Existing Retail Notes as part of the Restructuring as
mentioned above.
· Engaging in commodity hedging activities: In line with its financial
policies, the Group entered into a number of commodity hedging contracts in
2014, partially hedging the Group's exposure to fluctuations in oil prices, and
entered into additional hedging contracts in 2015 as a response to the continued
low oil price environment. As of 31 December 2015, the Group's commodity hedging
contracts included bought put options over 8MMbbls, maturing throughout 2016,
with an average strike price of $68/bbl and oil swap contracts to sell 2MMbbls
at an average price of $66.64/bbl maturing throughout 2016. These hedging
arrangements considerably mitigated the fall in the Group's revenues in 2015, as
the Group recognised $261.2 million in realised gains from its hedging
activities (relating to the portion of the Group's commodity hedging contracts
that were ineffective for hedging purposes or held for trading purposes) during
the year ended 31 December 2015. As of 30 June 2016, the Group's commodity
hedging contracts included bought put options over 4.3MMbbls at an average price
of $68/bbl maturing throughout 2016 and oil swap contracts to sell 1.3MMbbls at
an average price of $67/bbl maturing throughout 2016. During the first six
months of 2016, the Group realised $128.1 million in revenue relating to its
commodity hedging activities, which partially offset the decline in oil sales.
Since 30 June 2016, the Group entered hedging arrangements over 1MMbbl of 2017
production (83kbbls/ month) at a fixed price of $51.50. The Group has also sold
500,000bbls per month for the first half of 2017 (3 MMbbls total) at a fixed
price of $49/bbl and has bought a call (nil cost) for the same notional
quantity, with a strike at $57.25. Should the price rise above $57.25, the Group
will receive the difference to offset the loss it would make on the $49/bbl
swaps). In addition, the Group hedged 500,000 bbls for the first half of 2017 at
$54.50.
· Divesting non-core assets: In 2015, as part of its investment prioritisation
programme, the Group disposed of its interests in assets in Norway, Egypt and
Tunisia and its exploration assets in Malaysia. The Group also relinquished its
interests in a number of exploration licences in the UK. These divestments have
allowed the Group to focus on enhancing production at its currently producing
assets, including bringing Alma/Galia into full production, and developing its
core development assets, being Kraken and Scolty/Crathes.
· Reducing operating costs: In line with the Group’s focus on cost efficiency,
it has made further significant cuts to its cost base since the decline in oil
prices, including through lowering supply chain, contractor and staff costs,
moving its procurement team to Dubai to take advantage of lower cost structures
and working with the SVT operator to reduce gross cost levels. EnQuest reduced
average unit operating costs in 2015 to $30/bbl (compared to $42/bbl in 2014)
and in the first half of 2016 to $23/bbl (compared to $39/bbl in the first half
of 2015). The Directors expect average unit operating costs for the full year
2016 to be around the lower end of the guidance of $25-$27/bbl and expect that
unit operating costs will decrease to the low $20s per barrel when Kraken comes
fully on-stream.
· Reducing capital expenditure on the Kraken development: The gross full cycle
capital expenditure estimate for Kraken has been reduced to approximately $2.5
billion from $3.2 billion at sanction in 2013.
· Improving future cash flows through the development of Kraken and
Scolty/Crathes: The Directors expect that Kraken will deliver first oil in the
first half of 2017 and that the Scolty / Crathes fields will deliver first oil
around the end of 2016. The increase in production and, as a result, revenues
brought about by the completion of these developments, combined with reduced
capital expenditure and operational costs, would improve the Group's cash flow
position.
· Deferring certain trade creditor obligations: The Group has also recently
agreed the deferral of certain payments owed to several of its trade suppliers,
which the Directors believe demonstrate trade suppliers' willingness to support
the Company. Pursuant to these arrangements, these trade suppliers have agreed
for outstanding liabilities to be deferred in accordance with agreed repayment
profiles, allowing the Group to repay these liabilities through periodic
payments extending to between October 2016 and April 2019. These measures have
been significant steps in maintaining the Group's viability in the current
environment.
The Directors recognise, however, that in order to allow the Group to continue
to pursue its current strategy (and, in particular, to bring Kraken to first
oil) and to maintain the viability of the Group's business going forward, a
longer term solution is needed to strengthen the Group's liquidity position and
reduce the burden of the Group's debt service obligations on its business.
Having negotiated with relevant stakeholders, including the Existing RCF Lenders
and the Ad Hoc Noteholder Committee, the Directors have therefore proposed the
measures comprised in the Restructuring.
All of the elements of the Restructuring are inter-conditional, meaning that
none of the components of the Restructuring will be completed if the Placing and
Open Offer is not approved by Shareholders and that the Placing and Open Offer
will not proceed if the other components of the Restructuring are not consented
to and/or completed.
Principal terms and conditions of the Placing and Open Offer
The Company intends to raise total gross proceeds of an aggregate of
approximately £82.0 million (equivalent to SEK 884 million at exchange rate of
SEK 1.00 = GBP 0.0928 on 12 October 2016) (approximately $100 million)
(approximately £78.1 million, (equivalent to SEK 842 million at exchange rate of
SEK 1.00 = GBP 0.0928 on 12 October 2016) or $95 million, net of estimated
expenses) through the issue of 356,738,114 New Ordinary Shares by way of the
Placing and Open Offer at the Issue Price. The Placing and Open Offer is
conditional upon, amongst other things, LSE Admission becoming effective by not
later than 8.00 a.m. on 21 November 2016 (or such later time and/or date as the
Company may agree with the Joint Bookrunners, not being later than 8.00 a.m. on
24 November 2016).
The Issue Price represents a discount of 4.8 pence (17.1 per cent.) to the
closing middle market price of 27.8 pence per Existing Ordinary Share on the
London Stock Exchange on 12 October 2016 (being the last trading day prior to
the announcement of the Placing and Open Offer) and a discount of SEK 0.54 (17.9
per cent.) to the closing middle market price of SEK 3.02 per Existing Ordinary
Share on NASDAQ Stockholm on 12 October 2016 (being the last trading day prior
to the announcement of the Placing and Open Offer).
Irrevocable undertakings to take up entitlements under the Open Offer have been
received from Double A Limited, a company beneficially owned by the extended
family of Amjad Bseisu, and the Trustees, representing in aggregate 11.9 per
cent. of the New Ordinary Shares.
The Placing and Open Offer is conditional, inter alia, upon:
(a) the Placing Terms Agreement having been duly executed and
delivered by the parties thereto by no later 5:00 p.m. on 13 October 2016 (or
such later time and/or date as the Joint Bookrunners may agree with the
Company);
(b) the passing without amendment of the Resolutions at the General
Meeting (and not, except with the prior written agreement of the Joint
Bookrunners, acting jointly, at any adjournment of such meeting) on 14 November
2016 (or such later date as the Joint Bookrunners may agree) and the Resolutions
remaining in force;
(c) the Company having complied with its obligations under the Sponsor
and Placing Agreement and under the terms and conditions of the Placing and Open
Offer which fall to be performed on or prior to LSE Admission save as otherwise
agreed by the Joint Bookrunners, acting jointly;
(d) save for any condition in relation to Admission, the Proposed RCF
Amendments and the Amendment and Restatement Agreement becoming unconditionally
effective prior to LSE Admission;
(e) save for any condition in relation to Admission, the renewal of
the Surety Bond Facilities becoming unconditionally effective prior to LSE
Admission;
(f) save for any condition in relation to Admission, the Scheme and
the Proposed Note Amendments becoming unconditionally effective prior to LSE
Admission;
(g) LSE Admission becoming effective by not later than 8.00 a.m. on 21
November 2016 (or such later time and/or date as the Company may agree with the
Joint Bookrunners, not being later than 8.00 a.m. on 24 November 2016) and
application for Stockholm Admission having been made and no notification having
been received that Stockholm Admission has been refused or will not become
effective on or prior to 24 November 2016; and
(h) the Double A Placing Letter and associated Letter of Credit being
entered into by the parties thereto having, and continuing to have, full force
and effect and not having been terminated, varied, modified or supplemented or
lapsing before LSE Admission, and no right to terminate or rescind the Double A
Placing Letter and associated Letter of Credit having arisen before LSE
Admission.
Accordingly, if any such conditions are not satisfied the Placing and Open Offer
will not proceed, any Open Offer Entitlements admitted to CREST will thereafter
be disabled and application monies received under the Open Offer will be
refunded to the applicants, by cheque (at the applicant's risk) in the case of
Qualifying Non-CREST Shareholders, by way of a CREST payment in the case of
Qualifying CREST Shareholders, by way of payment to the Swedish Issuer Agent in
the case of Qualifying Swedish Directly Registered Shareholders and by way of
payment in accordance with the applicable procedures of the relevant nominee in
the case of Qualifying Swedish Nominee Registered Shareholders, without
interest, as soon as practicable thereafter.
A Qualifying Shareholder that does not take up any Open Offer Shares under the
Open Offer (or a Shareholder in the United States or an Excluded Territory who
is not eligible to participate in the Open Offer) will experience a dilution of
30.8 per cent. as a result of the Placing and Open Offer.
Further information on the Placing and Open Offer, and the terms and conditions
on which they are made, including the procedure for application and payment in
the Open Offer, are set out in the Prospectus.
The Joint Bookrunners have agreed, pursuant to the Sponsor and Placing
Agreement, to conditionally place all the Open Offer Shares (other than the
Committed Shares) at the Issue Price with Placees. The commitments of these
Placees are subject to clawback in respect of valid applications for Open Offer
Shares by Qualifying Shareholders pursuant to the Open Offer. The commitment of
Double A Limited as a Placee is also subject to Scale Back. Subject to the
Placing and Open Offer not being terminated, any Open Offer Shares which are not
applied for in respect of the Open Offer will be issued to Placees procured by
the Joint Bookrunners or, failing which (other than the New Ordinary Shares
which the Trustees have undertaken to subscribe for pursuant to the EnQuest EBT
Irrevocable Undertaking and which Double A Limited has undertaken to subscribe
for pursuant to the Double A Irrevocable Undertaking and the Double A Placing
Letter, which are not being underwritten), to the Joint Bookrunners, in each
case at the Issue Price, with the net proceeds retained for the benefit of the
Company. For the avoidance of doubt, the New Ordinary Shares to be subscribed
for by Double A Limited in the Placing and Open Offer are not being underwritten
by the Joint Bookrunners.
Qualifying Shareholders are being given the opportunity to apply for the Open
Offer Shares at the Issue Price on and subject to the terms and conditions of
the Open Offer, pro rata to their holdings of Existing Ordinary Shares on the
Record Date on the following basis:
4 New Ordinary Shares for every 9 Existing Ordinary Shares
and so in proportion to any other number of Existing Ordinary Shares then held.
Fractions of New Ordinary Shares will not be allotted and each Qualifying
Shareholder's entitlement under the Open Offer will be rounded down to the
nearest whole number. Fractional entitlements will be aggregated and will be
placed pursuant to the Placing for the benefit of the Company. Accordingly,
Qualifying Shareholders with fewer than 3 Existing Ordinary Shares will not have
the opportunity to participate in the Open Offer.
The New Ordinary Shares issued under the Placing and Open Offer, when issued and
fully paid, will be identical to, and rank pari passu with, the Existing
Ordinary Shares, including the right to receive all dividends and other
distributions declared, made or paid on the Existing Ordinary Shares by
reference to a record date on or after Admission.
Applications will be made (i) to the Financial Conduct Authority for 356,738,114
New Ordinary Shares to be issued under the Placing and Open Offer to be admitted
to the premium listing segment of the Official List; (ii) to the London Stock
Exchange for 356,738,114 New Ordinary Shares to be issued under the Placing and
Open Offer to be admitted to trading on its main market for listed securities;
and (iii) to NASDAQ Stockholm AB for New Ordinary Shares to be issued under the
Placing and Open Offer to be listed on NASDAQ Stockholm. Subject to the
conditions below being satisfied, it is expected that LSE Admission will become
effective on 21 November 2016 and that dealings for normal settlement in the
Open Offer Shares will commence at 8.00 a.m. on the same day and Stockholm
Admission will become effective on or around 21 November 2016 and that dealings
for normal settlement in the Open Offer Shares will commence on the same day.
Application will be made for the Open Offer Entitlements to be admitted to
CREST. It is expected that the Open Offer Entitlements will be admitted to CREST
as soon as practicable after 8.00 a.m. on 21 October 2016 and that the Open
Offer Entitlements will also be enabled for settlement in CREST as soon as
practicable after 8.00 a.m. on 21 October 2016. Qualifying Swedish Shareholders
will not receive Open Offer Entitlements but instead will receive a Pre-Printed
Issue Account Statement and Swedish Application Form if Qualifying Swedish
Directly Registered Shareholders or will need to follow instructions from their
nominees if Qualifying Swedish Nominee Registered Shareholders.
The Record Date for entitlements under the Open Offer and right to participate
in the Swedish Open Offer will be at 6.00 p.m. on 19 October 2016. The ex
-entitlement date for the Swedish Open Offer for Ordinary Shares held in the VPC
System and traded on NASDAQ Stockholm will be 18 October 2016 and the ex
-entitlement date for the Open Offer for Ordinary Shares held in CREST and
traded on the London Stock Exchange will be 20 October 2016. It will not be
possible to settle any trades in Ordinary Shares between the VPC System and
CREST from the ex-entitlement date for the Swedish Open Offer until the ex
-entitlement date for the Open Offer. The Open Offer Entitlements will be
credited to stock accounts in CREST of Qualifying CREST Shareholders as soon as
practicable after 8.00 a.m. on 21 October 2016 and subscription rights, as set
out in the Pre-Printed Issue Report, will be credited to the VPC Accounts of
Qualifying Swedish Directly Registered Shareholders and, pursuant to the
procedures of the relevant nominee, to the nominee accounts of Qualifying
Swedish Nominee Registered Shareholders as soon as practicable after 9.00 a.m.
(Stockholm time) on 21 October 2016.
Use of proceeds from the Placing and Open Offer
It is intended that the net proceeds of the Placing and Open Offer (being
approximately $95 million, assuming full subscription under the Placing and Open
Offer and after expenses in connection with the Placing and Open Offer), will be
applied by the Group to:
(a) continue the development of the Group's Kraken asset with the aim
of achieving first oil in the first half of 2017;
(b) continue the development of the Group's Scolty/Crathes asset; and
(c) 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.
Financial effects of the Placing and Open Offer and Restructuring
On a pro forma basis and assuming that the Placing and Open Offer and
Restructuring had taken place on 30 June 2016, the Group would have had net
assets of approximately $833.4 million, compared with net assets of $738.1
million reported as at 30 June 2016. Please refer to Part 6 ("Unaudited Pro
Forma Financial Information") of the Placing and Open Offer Prospectus which
contains an unaudited pro forma balance sheet, prepared to illustrate the effect
of the Placing and Open Offer and the Proposed Note Amendments on the net assets
of the Company as if these events had taken place on 30 June 2016.
The Directors believe that the proposed Restructuring, including the injection
of additional equity capital in the Company pursuant to the Placing and Open
Offer, will improve the Group's capital structure and improve the ongoing
liquidity position of the Group, putting it in a stronger position to withstand
a prolonged period of low oil prices.
APPENDIX I - TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES ONLY
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE CONDITIONAL PLACING
OF NEW ORDINARY SHARES SUBJECT TO CLAWBACK TO SATISFY VALID APPLICATIONS BY
QUALIFYING SHAREHOLDERS UNDER THE OPEN OFFER. THIS ANNOUNCEMENT (WHICH IS FOR
INFORMATION PURPOSES ONLY) AND THE TERMS AND CONDITIONS SET OUT IN THIS APPENDIX
ARE DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA
("EEA") WHO ARE QUALIFIED INVESTORS WITHIN THE MEANING OF ARTICLE 2(1) (E) OF
THE EU PROSPECTUS DIRECTIVE (WHICH MEANS DIRECTIVE 2003/71/EC, AS AMENDED FROM
TIME TO TIME, INCLUDING DIRECTIVE 2010/73/EC, AND INCLUDES ANY RELEVANT
IMPLEMENTING DIRECTIVE MEASURE IN ANY MEMBER STATE) (THE "PROSPECTUS DIRECTIVE")
("QUALIFIED INVESTORS"); AND (B) PERSONS IN THE UNITED KINGDOM WHO ARE QUALIFIED
INVESTORS AND (I) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO
INVESTMENTS FALLING WITHIN ARTICLE 19(1) OF THE FINANCIAL SERVICES AND MARKETS
ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE "ORDER"); (II) ARE PERSONS
FALLING WITHIN ARTICLE 49(2) (A) TO (D) ("HIGH NET WORTH COMPANIES,
UNINCORPORATED ASSOCIATIONS, ETC") OF THE ORDER; OR (III) ARE PERSONS TO WHOM IT
MAY OTHERWISE BE LAWFULLY COMMUNICATED; OR (C) PERSONS TO WHOM IT MAY OTHERWISE
BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS
"RELEVANT PERSONS"). THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN
MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS.
PERSONS DISTRIBUTING THIS ANNOUNCEMENT (INCLUDING THIS APPENDIX) MUST SATISFY
THEMSELVES THAT IT IS LAWFUL TO DO SO. ANY INVESTMENT OR INVESTMENT ACTIVITY TO
WHICH THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN RELATE IS
AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT
PERSONS. THIS APPENDIX DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR
SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY.
THE SECURITIES REFERRED TO IN THIS ANNOUNCEMENT HAVE NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE US SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), OR UNDER THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE
UNITED STATES, AND MAY NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN OR
INTO THE UNITED STATES EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
COMPLIANCE WITH THE SECURITIES LAWS OF ANY STATE OR ANY OTHER JURISDICTION OF
THE UNITED STATES. THE NEW ORDINARY SHARES OFFERED AND SOLD PURSUANT TO THE
PLACING ARE BEING OFFERED AND SOLD OUTSIDE THE UNITED STATES IN ACCORDANCE WITH
REGULATION S UNDER THE SECURITIES ACT. NO PUBLIC OFFERING OF SECURITIES IS BEING
MADE IN THE UNITED STATES OR ELSEWHERE.
EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL, TAX, BUSINESS AND
RELATED ASPECTS OF AN ACQUISITION OF NEW ORDINARY SHARES.
The New Ordinary Shares have not been, nor will they be, registered or offered
under the relevant securities laws of any state, province or territory of any
Excluded Territory. Accordingly, the New Ordinary Shares may not be offered or
sold, resold, taken up, transferred, delivered or distributed, directly or
indirectly, into or within any of the Excluded Territories except pursuant to an
applicable exemption from registration or qualification requirements. None of
the terms and conditions set out in this Appendix I, the Placing Proof
Prospectus, or the Placing Letter is or constitutes an invitation or offer to
sell or the solicitation of an invitation or an offer to buy New Ordinary Shares
in any jurisdiction in which such offer to sell or solicitation is unlawful.
Persons into whose possession these documents come should inform themselves
about and observe such restrictions. Any failure to comply with these
restrictions may constitute a violation of the securities laws of any such
jurisdiction.
The Joint Bookrunners do not make any representation to any Placees regarding an
investment in the securities referred to in this announcement (including this
Appendix I), the Placing Proof Prospectus, the Placing Letter or the Prospectus.
Persons (including, without limitation, nominees and trustees) who have a
contractual or other legal obligation to forward a copy of this Appendix I or
the announcement of which it forms part should seek appropriate advice before
taking any action.
Participation in, and principal terms of, the Placing
1. The Joint Bookrunners are acting as bookrunners and agents of the Company in
connection with the Placing.
2. The Joint Bookrunners are arranging the Placing severally (and not jointly
nor jointly and severally) as bookrunners and agents of the Company.
Participation in the Placing will only be available to persons who are Relevant
Persons and who may lawfully be, and are, invited to participate by either of
the Joint Bookrunners. Each of the Joint Bookrunners and their respective
affiliates are entitled to enter bids as principal in the Bookbuild.
3. The Bookbuild will establish the identity of the Placees and allocations of
New Ordinary Shares to be allocated to Placees pursuant to the Placing whose
bids are successful. The results of the Placing will be announced through a
Regulatory Information Service following completion of the Bookbuild (the
"Pricing Information").
4. To bid in the Bookbuild, Placees should communicate their bid by telephone
to their usual sales contact at one of the Joint Bookrunners. Each bid should
state the number of New Ordinary Shares which the prospective Placee wishes to
acquire at the Issue Price. Bids may be scaled down by the Joint Bookrunners on
the basis referred to in paragraph 9 below.
5. A bid in the Bookbuild will be made on the terms and subject to the
conditions in this Appendix I, the Placing Letter, the Placing Proof Prospectus
and the Pricing Information, will be legally binding on the Placee on behalf of
which it is made and, except with the Joint Bookrunners' consent, will not be
capable of variation or revocation after the time at which it is submitted. Each
Placee will also have an immediate, separate, irrevocable and legally binding
obligation owed to the Joint Bookrunners, as agent for the Company, to pay the
Joint Bookrunners (or as they may direct) in cleared funds an amount equal to
the product of the Issue Price and the number of New Ordinary Shares that such
Placee has agreed to acquire (subject to clawback to satisfy valid applications
by Qualifying Shareholders under the Open Offer) on the basis explained below
under "Placing Procedure" and in the Placing Letter. Each Placee's obligations
will be owed to the Joint Bookrunners.
6. The book will open with immediate effect and may close at any time
thereafter, at the discretion of the Joint Bookrunners following consultation
with the Company. The Joint Bookrunners may, in agreement with the Company,
accept bids that are received after the Bookbuild has closed.
7. Each prospective Placee's allocation ("Provisional Placing Participation")
will be agreed between the Joint Bookrunners and will be confirmed to Placees
orally by the relevant Joint Bookrunner following the close of the Bookbuild,
and the Placing Letter will be dispatched as soon as possible thereafter. The
relevant Joint Bookrunner's oral confirmation to such Placee will constitute an
irrevocable and legally binding commitment upon such person (who will at that
point become a Placee) in favour of such Joint Bookrunner and the Company, to
acquire the number of New Ordinary Shares allocated to it (subject to clawback
to satisfy valid application by Qualifying Shareholders under the Open Offer)
and to pay the Issue Price on the terms and conditions set out in this Appendix
I, the Placing Proof, the Placing Letter and in accordance with the Company's
articles of association. Each Placee will confirm such irrevocable and legally
binding commitment by completing, signing and returning the form of acceptance
contained in the Placing Letter in accordance with the instructions therein, and
should a Placee fail to do so, the Joint Bookrunners will retain the right to
cancel their allocation or terminate such irrevocable and legally binding
commitment.
8. All obligations under the Bookbuild and the Placing will be subject to
fulfilment or (where applicable) waiver of the conditions referred to in this
announcement and to the Sponsor and Placing Agreement not having being
terminated on the basis referred to below under "Right to terminate under the
Sponsor and Placing Agreement".
9. The Joint Bookrunners may choose to accept bids, either in whole or in part,
on the basis of allocations determined in agreement with the Company and may
scale down any bids for this purpose on such basis as they may determine. The
Joint Bookrunners may also, notwithstanding paragraphs 4 and 5 above and subject
to prior consent of the Company (i) allocate New Ordinary Shares after the time
of any initial allocation to any person submitting a bid after that time; and
(ii) allocate New Ordinary Shares after the Bookbuild has closed to any person
submitting a bid after that time. The Company reserves the right (upon agreement
with the Joint Bookrunners) to reduce or seek to increase the amount to be
raised pursuant to the Placing, at its absolute discretion. The acceptance of
the bids shall be at the relevant Joint Bookrunner's absolute discretion,
subject to agreement with the Company.
10. Irrespective of the time at which a Placee's allocation pursuant to the
Placing is confirmed, settlement for all New Ordinary Shares to be acquired
pursuant to the Placing will be required to be made at the same time, on the
basis explained below under "Registration and Settlement" and in the Placing
Letter.
11. Except as required by law or regulation, no press release or other
announcement will be made by the Joint Bookrunners or the Company using the name
of any Placee (or its agent), in its capacity as Placee (or agent), other than
with such Placee's prior written consent.
12. By participating in the Bookbuild, each Placee agrees that its rights and
obligations in respect of the Placing will terminate only in the circumstances
described below and will not be capable of rescission or termination by the
Placee.
13. To the fullest extent permissible by law, neither of the Joint Bookrunners
nor any of their respective affiliates, agents, directors, officers or employees
shall have any responsibility or liability to Placees (or to any other person
whether acting on behalf of a Placee or otherwise). In particular, neither of
the Joint Bookrunners nor any of their respective affiliates, agents, directors,
officers or employees shall have any responsibility or liability (including, to
the fullest extent permissible by law any fiduciary duties) in respect of the
Joint Bookrunners' conduct of the Bookbuild or such alternative method of
effecting the Placing as the Joint Bookrunners and the Company may agree.
Lock-up
Pursuant to the terms of the Sponsor and Placing Agreement, the Company has
undertaken that it will not without the prior written consent of the Joint
Bookrunners, during the period ending six months from the date of LSE Admission:
(i) directly or indirectly, issue, allot, offer, pledge, sell, contract to sell,
lend, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase, deposit into any
depositary receipt facility or otherwise transfer or dispose of any Ordinary
Shares or any interest in Ordinary Shares or any securities convertible into or
exercisable or exchangeable for, or substantially similar to, Ordinary Shares or
file any registration statement under the Securities Act with respect to any of
the foregoing (or publicly announce the same or any intention to do the same);
or (ii) enter into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly, or indirectly, the economic
consequences of ownership of the Ordinary Shares (or publicly announce the same
or any intention to do the same), whether any such swap or transaction described
in (i) or (ii) above is to be settled by delivery of the Ordinary Shares or such
other securities, in cash or otherwise.
The foregoing undertaking does not apply to: (a) the issue and offer by or on
behalf of the Company of the New Ordinary Shares; (b) any Ordinary Shares issued
or to be issued by the Company upon the exercise of an option or warrant or the
conversion of a security outstanding on the date hereof and disclosed in this
document; and (iii) any Ordinary Shares issued or to be issued or options to
subscribe for or acquire Ordinary Shares granted pursuant to existing or
proposed employee benefit plans of the Company.
By participating in the Placing, Placees agree that the exercise by any Joint
Bookrunner of any power to grant consent to the undertaking by the Company of a
transaction which would otherwise be subject to the lockup under the Sponsor and
Placing Agreement shall be within the absolute discretion of that Joint
Bookrunner and that it need not make any reference to, or consult with, Placees
and that it shall have no liability to Placees whatsoever in connection with any
such exercise of the power to grant consent.
Right to terminate under the Sponsor and Placing Agreement
The Joint Bookrunners may terminate the Sponsor and Placing Agreement in certain
circumstances (such as a material adverse change or force majeure event) but
only prior to the earlier of LSE Admission and Stockholm Admission. The Joint
Bookrunners are not entitled to terminate the Sponsor and Placing Agreement
after such time.
By participating in the Placing, Placees agree that the exercise by either Joint
Bookrunner of any right of termination or other discretion under the Sponsor and
Placing Agreement shall be within the absolute discretion of that Joint
Bookrunner and that it need not make any reference to, or consult with, Placees
and that it shall have no liability to Placees whatsoever in connection with any
such exercise.
Placing Procedure
Following the closing of the Bookbuild, each Placee conditionally allocated New
Ordinary Shares in the Placing will be sent the Placing Letter confirming the
contract concluded upon acceptance by the Joint Bookrunners of such Placee's
earlier oral commitment to subscribe for New Ordinary Shares and also confirming
the number of New Ordinary Shares conditionally allocated to it (subject to
clawback to satisfy valid applications by Qualifying Shareholders under the Open
Offer) at the Issue Price, the aggregate amount owed by such Placee to the Joint
Bookrunner and settlement instructions.
The commitments of Placees to acquire the New Ordinary Shares pursuant to the
Placing are subject to clawback to satisfy valid applications by Qualifying
Shareholders under the Open Offer. The Joint Bookrunners have discretion with
regard to the manner and extent of any scaling back of a Placee's conditional
allocation, and such scaling back may not be pro rata to conditional
allocations.
The Joint Bookrunners will notify Placees if any of the dates in the Appendices
should change, including as a result of delay in the posting of the Prospectus,
the Application Forms or the crediting of the Open Offer Entitlements in CREST
or the production of a supplementary prospectus or otherwise.
Registration and settlement
Upon closing of the Open Offer (and following clawback to satisfy valid
applications by Qualifying Shareholders under the Open Offer), the Joint
Bookrunners will confirm the final allocations of New Ordinary Shares to be
issued to Placees (each a "Final Placing Participation") pursuant to the Placing
orally or in writing to Placees and will issue a contract note or trade
confirmation in respect of such Final Placing Participations (other than in
respect of Double A Limited). The contract note or trade confirmation will
include the payment and settlement procedures to be followed by Placees in
connection with their subscriptions for the New Ordinary Shares comprised in
their Final Placing Participations.
Settlement of transactions in the New Ordinary Shares following Admission will
take place within CREST, subject to certain exceptions. The Joint Bookrunners
and the Company reserve the right to require settlement for, and delivery of,
the New Ordinary Shares (or any part thereof) to Placees by such other means
that they deem necessary if delivery or settlement is not possible or
practicable within CREST by the expected time for settlement and delivery set
out in the contract note or trade confirmation or would not be consistent with
the regulatory requirements in the Placee's jurisdiction.
Each Placee agrees that it will do all things necessary to ensure that delivery
and payment is completed in accordance with the instructions set out in the
Placing Letter and the contract note or trade confirmation (if applicable) and
in accordance with the standing CREST instructions in respect of the New
Ordinary Shares that it has in place with the relevant Joint Bookrunner.
Representations, warranties and further terms
By participating in the Placing and/or completing (as applicable), signing and
returning the Letter of Confirmation attached to the Placing Letter, each Placee
(and any person acting on such Placee’s behalf) (referred to as “you” below)
irrevocably acknowledges, confirms, undertakes, represents, warrants and agrees
(as the case may be) with the Joint Bookrunners (in their capacity as
bookrunners and placing agents of the Company, in each case as a fundamental
term of their application for New Ordinary Shares), the following:
1. you have accepted the terms and conditions of this announcement,
the Sponsor and Placing Agreement, Placing Proof Prospectus, the Pricing
Information and, accordingly, to have irrevocably agreed in accordance with such
terms and conditions to subscribe and pay for the number of New Ordinary Shares
comprised in your Final Placing Participation at the Issue Price;
2. you acknowledge that your agreement so to subscribe for the number
of New Ordinary Shares comprised in your Final Placing Participation is not by
way of acceptance of a public offer made or to be made in the Prospectus but is
by way of a collateral contract and, accordingly, section 87Q of FSMA does not
entitle you to withdraw your acceptance in the event that the Company publishes
a supplementary prospectus in connection with the Placing and Open Offer and/or
Admission. Without prejudice to such acknowledgement, if you are so entitled to
withdraw, by accepting the offer of your Final Placing Participation contained
in this announcement, you irrevocably agree (if applicable) not to exercise any
such rights and to confirm your acceptance of the offer contained in this
announcement on the same terms immediately after any such right to withdraw
arises;
1. the Joint Bookrunners are not acting for you; the Joint Bookrunners are
acting solely for the Company in relation to the Placing and Open Offer and
Admission and in no other capacity;
2. you have not relied on any information, representations and/or warranties
from the Joint Bookrunners or the Company or any other person and have only
relied on the information contained in the Placing Proof Prospectus, the Pricing
Information and this announcement;
3. you understand and accept that by offering you a Provisional Placing
Participation and/or a Final Placing Participation, the Joint Bookrunners are
not making any recommendations to or advising you regarding the suitability or
merits of any transaction you may enter into in connection with the Placing and
Open Offer or otherwise and that you are not, and do not regard yourself as, our
client in connection with the Placing and Open Offer, and that the Joint
Bookrunners are acting solely for the Company in relation to the transaction as
set out in the Placing Proof Prospectus and will not be responsible to you for
providing the protections afforded to their respective clients or for advising
you on the transactions and arrangements proposed in the Placing Proof
Prospectus and/or the Sponsor and Placing Agreement nor for the exercise or
performance of any of their respective rights and obligations thereunder,
including any rights to waive or vary any conditions or exercise any termination
right;
4. you irrevocably agree to subscribe for, and purchase the number of, New
Ordinary Shares comprised in your Final Placing Participation at the Issue Price
and on the terms set out in the Placing Proof Prospectus, that you have obtained
all necessary consents and authorities to enable you to give your commitment to
so subscribe and purchase, you have funds available to do so, and that you will
pay for your Final Placing Participation in full;
5. you have received and read a copy of this announcement, the Placing Proof
Prospectus and the Pricing Information and all such other information as you
deem necessary to make an investment decision in relation to the New Ordinary
Shares;
6. you have made your own assessment and have satisfied yourself concerning the
relevant tax, legal, currency and other economic considerations relevant to your
investment in the New Ordinary Shares and have relied on your own investigation
of the business, financial or other position of the Company in accepting a
participation in the Placing and Open Offer; (ii) neither of the Joint
Bookrunners nor any of their respective affiliates or any person acting on
behalf of any of them has provided, or will provide you, with any material
regarding the New Ordinary Shares in addition to the Placing Proof Prospectus
and the Pricing Information; and (iii) you have not requested that the Joint
Bookrunners, the Company or any of their respective affiliates or any person
acting on behalf of any of them to provide you with any such information;
7. the contents of the Placing Proof Prospectus, this announcement and the
Pricing Information are exclusively the responsibility of the Company and that
neither of the Joint Bookrunners nor any of their respective affiliates,
employees, agents or advisers nor any other person acting on their behalf make
any representation or warranty, express or implied, in relation to, nor will be
responsible for or shall have liability for any information, representation or
statement contained therein or any information previously published by or on
behalf of the Company or any other written or oral information made available to
or publicly available or filed information or any representation, warranty or
undertaking relating to the Company, and neither of the Joint Bookrunners nor
their respective affiliates or any person acting on their behalf will be
responsible or liable for your investment decision in relation to the New
Ordinary Shares based on any information representation or statement contained
in the Placing Proof Prospectus, this announcement and the Pricing Information;
8. you will only be entitled to rely on any information or representation in
relation to the Company or the New Ordinary Shares contained in the Placing
Proof Prospectus, the Pricing Information, the Prospectus and any supplementary
prospectus;
9. unless otherwise agreed in writing with the Joint Bookrunners, you are a
person whose ordinary activities involve you (as principal or agent) in
acquiring, holding, managing or disposing of investments for the purpose of your
business and you undertake that you will (as principal or agent) acquire, hold,
manage or dispose of any New Ordinary Shares that are allocated to you for the
purposes of your business;
10. unless otherwise agreed in writing with the Joint Bookrunners, if you are a
resident in the EEA, you are a qualified investor within the meaning of the law
in the relevant member state implementing Article 2(1)(e)(i), (ii) or (iii) of
the Prospectus Directive;
11. you have complied with your obligations in connection with money laundering
and terrorist financing under the Proceeds of Crime Act 2002 (as amended) and
the Terrorism Act 2000 (as amended), the Terrorism Act 2006 (as amended), the
Money Laundering Regulations 2007 and the Money Laundering Sourcebook of the
Financial Conduct Authority and any other applicable legislation concerning
prevention of money laundering (the “Regulations”) and you will on request from
the relevant Joint Bookrunner provide any such information and provide such
assistance to such Joint Bookrunner in order to verify your identity which such
Joint Bookrunner may require in compliance with the Regulations and, if you are
making payment on behalf of a third party, you have obtained and recorded
satisfactory evidence to verify the identity of the third party as required by
the Regulations. Definitive certificates in respect of the New Ordinary Shares
may be retained at the Joint Bookrunners’ absolute discretion or, where
appropriate, delivery of the New Ordinary Shares to you in uncertificated form,
may be retained at the Joint Bookrunner’s or the Company’s registrars’, as the
case may be, absolute discretion. If within a reasonable time after a request
for verification of identity either of the Joint Bookrunners (for itself and as
agent on behalf of the Company) or the Company’s registrars have not received
evidence satisfactory to them, such Joint Bookrunner and/or the Company may, at
its absolute discretion, terminate your commitment in respect of the Placing and
Open Offer, in which event the monies payable on acceptance of allotment will,
if already paid, be returned without interest to the account of the drawee’s
bank from which they were originally debited. Your attention is further drawn to
the section entitled “Money Laundering Legislation” contained in Part 10 of the
Placing Proof Prospectus;
12. you acknowledge that the New Ordinary Shares are being offered in a
transaction not involving any public offering in the United States within the
meaning of the Securities Act and that the New Ordinary Shares are not being and
will not be registered under the Securities Act or under any securities laws of
any state or other jurisdiction of the United States and you further acknowledge
that the New Ordinary Shares offered pursuant to the Placing may not be offered,
sold, pledged, resold, transferred, delivered or distributed within the United
States;
13. you understand that the New Ordinary Shares have not been registered under
the applicable laws of an Excluded Territory. To the extent that you are a
resident of any Excluded Territory or a corporation, partnership or other entity
organised under the laws of any Excluded Territory, you will only take up New
Ordinary Shares pursuant to an available exemption under applicable law;
14. you have not and will not distribute or publish the Placing Proof
Prospectus, this announcement or any advertisement or other offering material in
relation to the New Ordinary Shares directly or indirectly in, into or within
any of the Excluded Territories;
15. you will not make any offer to the public of the New Ordinary Shares and
have not offered or sold and will not offer or sell any New Ordinary Shares to
persons in the United Kingdom or elsewhere in the EEA prior to Admission except
to persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for the purposes of
their business or otherwise in circumstances which have not resulted in and
which will not result in an offer to the public in the United Kingdom within the
meaning of section 85(1) of FSMA or an offer to the public in any other member
state of the EEA within the meaning of the Prospectus Directive (which includes
any relevant implementing measure in any member state of the EEA);
16. you have observed the laws of all relevant jurisdictions, obtained any
requisite governmental exchange controls or other consents, complied with all
relevant formalities and paid any issue, transfer or other taxes due in
connection with your Final Placing Participation in any territory and that you
have not taken any action which will or may result in the Joint Bookrunners or
the Company being in breach of the legal or regulatory requirements of any
jurisdiction;
17. you have only communicated or caused to be communicated and will only
communicate or cause to be communicated any invitation or inducement to engage
in investment activity (within the meaning of section 21 of the FSMA) relating
to the New Ordinary Shares in circumstances in which section 21(1) of the FSMA
does not require approval of the communication by an authorised person and you
acknowledge and agree that Placing Proof Prospectus are not being issued by the
Joint Bookrunners in their respective capacities as an authorised person under
section 21 of the FSMA and they may not therefore be subject to the controls
which would apply if they were made or approved as financial promotion by an
authorised person;
18. you have complied and will comply with all applicable provisions of the FSMA
with respect to anything done by you in relation to the New Ordinary Shares in,
from or otherwise involving, the United Kingdom;
19. you are not, and will not be, liable, and you are not applying as nominee(s)
or agent(s) for a person or persons who is/are or may be liable, to pay stamp
duty reserve tax under sections 93 or 96 of the Finance Act 1986 or stamp duty
under sections 67 or 70 of the Finance Act 1986, in each case at the increased
rates referred to in those sections. For the avoidance of doubt, if this
confirmation is incorrect, stamp duty or stamp duty reserve tax may be payable
for which neither of the Joint Bookrunners nor the Company will be responsible
and if, as a result, any of those persons is obliged by law to pay any such
stamp duty or stamp duty reserve tax, they shall be entitled to receive it from
you for which purposes you hereby agree to indemnify on demand the Joint
Bookrunners and the Company on an after-tax basis in respect of any such
liability for stamp duty and/or stamp duty reserve tax (and any related
interest, fines or penalties) arising in respect thereof;
20. you irrevocably appoint any director or employee of the Joint Bookrunners as
your agent for the purpose of executing and delivering to the Company and/or the
registrar any document on your behalf necessary to enable you to be registered
as the holder of New Ordinary Shares comprising your Final Placing Participation
or to complete the sale of such New Ordinary Shares on your behalf in the
circumstances referred to earlier;
21. if you are a financial intermediary, as that term is used in Article 3(2) of
the Prospectus Directive, any New Ordinary Shares purchased by you in the
Placing and Open Offer will not be acquired on a non-discretionary basis on
behalf of, nor will they be acquired with a view to their offer or resale to,
persons in a member state of the EEA which has implemented the Prospectus
Directive other than Qualified Investors (for the purposes of the Prospectus
Directive), or in circumstances in which the prior consent of the Joint
Bookrunners has been given to the Placing and Open Offer or resale;
22. you have not been engaged to subscribe for the New Ordinary Shares on behalf
of any other person who is not a Qualified Investor (for the purposes of the
Prospectus Directive) unless the terms on which you are engaged to enable you to
make decisions concerning the acceptance of offers of transferable securities on
the client’s behalf without reference to the client as described in section
86(2) of the FSMA;
23. you (i) are entitled to acquire the New Ordinary Shares under the law of all
relevant jurisdictions, (ii) have fully observed such laws, (iii) have the
capacity and authority and are entitled to enter into and perform your
obligations as an acquirer of New Ordinary Shares and will honour such
obligations and (iv) have obtained all necessary consents and authorities
(including, without limitation, in the case of any person on whose behalf you
are acting, all necessary consents and authorities to agree to the terms set out
or referred to in this announcement) to enable you to enter into the
transactions contemplated hereby and to perform your obligations in relation
thereto and, in particular, if you are a pension fund or investment company you
are aware of and acknowledge you are required to comply with all applicable laws
and regulations with respect to your subscription for the New Ordinary Shares;
24. you are not a person located in the United States and you will participate
in the proposed transaction via an “offshore transaction”, as defined in
Regulation S, conducted in accordance with Regulation S and the New Ordinary
Shares were not offered to you by means of “directed selling efforts”, as
defined in Regulation S;
25. you are not acting on a non-discretionary basis for the account or benefit
of a person located within the United States at the time the undertaking to
subscribe for New Ordinary Shares was given and you are not acquiring the New
Ordinary Shares with a view to the Placing and Open Offer, sale, resale,
transfer, delivery or distribution, directly or indirectly, of any New Ordinary
Shares into the United States;
26. you are an institution which has such knowledge and experience in financial
and business matters that you are capable of evaluating the merits and risks of
your investment in the New Ordinary Shares and you, and any accounts for which
you are acting, are able to bear the economic risk, and sustain a complete loss,
of such investment in the New Ordinary Shares;
27. you are a person of a kind described in Articles 19, 43 and/or 49 of the
Order or this announcement may otherwise be lawfully distributed to you pursuant
another applicable exemption under the Order and that you understand that the
information contained in this announcement is only directed in the United
Kingdom at (i) persons who have professional experience in matters relating to
investments who fall within the definition of “investment professionals” in
Article 19(5) of the Order, (ii) high net worth entities (including companies
and unincorporated associations of high net worth and trusts of high value) or
other persons falling within Article 49(2)(a) to (d) of the Order, and (iii)
persons to whom this announcement may otherwise be lawfully distributed, and
that, accordingly, any investment or investment activity to which this
announcement relates is available only to you as such a person or will be
engaged in only with you as such a person;
28. you are aware of the obligations regarding insider dealing in (i) the
Criminal Justice Act 1993; (ii) the FSMA; (iii) articles 17, 18 and 19 of the
Market Abuse Regulation (EU) No 596/2014; and (iv) the Proceeds of Crime Act
2002 and confirm that you have and will continue to comply with those
obligations;
29. the foregoing acknowledgements, confirmations, undertakings,
representations, warranties and agreements are given for the benefit of the
Company as well as each of the Joint Bookrunners and are irrevocable;
30. neither the Company nor either of the Joint Bookrunners owes any fiduciary
or other duties or responsibilities to you for providing the protections
afforded to their clients nor for providing advice in relation to the Placing
and Open Offer to any Placee in respect of any representations, warranties,
undertakings or indemnities in the Sponsor and Placing Agreement, this
announcement (including the contents of the terms and conditions contained in
this announcement) or the Placing Proof Prospectus;
31. you agree to indemnify and hold harmless the Company, the Joint Bookrunners
and their respective affiliates from, and waive any claim against the Company,
the Joint Bookrunners or their respective affiliates in respect of, any and all
costs, claims, losses, liabilities and expenses (including legal fees and
expenses) arising out of or in connection with any breach of the
representations, warranties, acknowledgements, agreements and undertakings in
this announcement and further agree that the provisions of this announcement
shall survive after completion of the Placing and Open Offer;
32. the Joint Bookrunners may, and their respective affiliates acting as an
investor for its or their own account(s) may, subscribe for and/or purchase New
Ordinary Shares and, in that capacity may retain, purchase, offer to sell or
otherwise deal for its or their own account(s) in the New Ordinary Shares, any
other securities of the Company or other related investments in connection with
the Placing and Open Offer or otherwise. Accordingly, references in this
announcement to the New Ordinary Shares being offered, subscribed, acquired or
otherwise dealt with should be read as including any offer to, or subscription,
acquisition or dealing by, either or both of the Joint Bookrunners and/or any of
their respective affiliates acting as an investor for its or their own
account(s). Neither of the Joint Bookrunners nor the Company intend to disclose
the extent of any such investment or transaction otherwise than in accordance
with any legal or regulatory obligation to do so;
33. the Company, the Joint Bookrunners and their respective affiliates and
others will rely upon the truth and accuracy of the foregoing agreements,
acknowledgements, representations, warranties and undertakings which are given
to the Joint Bookrunners on their own behalf and on behalf of the Company, and
which are irrevocable; and
34. the representations, warranties, undertakings, agreements, acknowledgements
and indemnities set out in this Appendix will survive completion of the Placing
and Open Offer.
APPENDIX II -EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Each of the dates and times in the table below is indicative only and may be
adjusted by the Company, in which event details of the new times and dates will
be notified to the UK Listing Authority, the London Stock Exchange and, where
appropriate, to Qualifying Shareholders by way of an announcement issued via a
RIS provider.
Announcement 13 October 2016
of the
Placing and
Open Offer and
the Scheme
Publication of 13 October 2016
the
Prospectus
Ex-entitlement 18 October 2016
date for the
Swedish Open
Offer
Record Date 6.00 p.m. on 19 October 2016
for
entitlements
under the Open
Offer and
right to
participate in
the Swedish
Open Offer
Ex-entitlement 20 October 2016
date for the
Open Offer
Posting of the 20 October 2016
Prospectus,
the Forms of
Proxy and the
Application
Forms and
distribution
of the
Practice
Statement
Letter in
connection
with the
Scheme and
posting in
Sweden of the
summary of
this combined
circular and
prospectus and
Pre-Printed
Issue Account
Statements,
and
subscription
period of
Swedish Open
Offer begins
Open Offer As soon as practicable after
Entitlements 8.00 a.m. on 21 October 2016
credited to
stock accounts
in CREST of
Qualifying
CREST
Shareholders
Subscription As soon as practicable after 9.00
rights, as set a.m. (Stockholm time) on 21 October
out in the Pre 2016
-Printed Issue
Account
Statements,
are credited
to the VP
Accounts of
Qualifying
Swedish
Directly
Registered
Shareholders
and, pursuant
to the
procedures of
the relevant
nominee, to
the nominee
accounts of
Qualifying
Swedish
Nominee
Registered
Shareholders
Court hearing 24 October 2016
for
permission to
convene the
Scheme Meeting
Latest 3.00 p.m. on 9 November 2016
recommended
time and date
for requesting
withdrawal of
Open Offer
Entitlements
from CREST
(i.e. if your
Open Offer
Entitlements
are in CREST
and you wish
to convert
them into
certificated
form)
Subscription 9 November 2016
period of
Swedish Open
Offer ends
Latest time 9.00 a.m. on 10 November 2016
and date for
receipt of
Forms of Proxy
or submission
of proxy votes
electronicall
y
Latest 3.00 p.m. on 10 November 2016
recommended
time and date
for depositing
Open Offer
Entitlements
into CREST
(i.e. if your
Open Offer
Entitlements
are
represented by
an Application
Form and you
wish to
convert them
to
uncertificated
form)
Latest time 3.00 p.m. on 11 November 2016
and date for
splitting
Application
Forms (to
satisfy bona
fide market
claims)
General 9.00 a.m. on 14 November 2016
Meeting
Scheme Meeting 14 November 2016
Announcement 14 November 2016
of the
results of the
General
Meeting
Latest time 11 a.m. (Stockholm time) on 16
and date for November 2016
receipt of
payment in
full under the
Swedish Open
Offer in
accordance
with (i) the
Pre-Printed
Payment
Notices or
(ii) completed
Swedish
Application
Forms
Latest time 11.00 a.m. on 16 November 2016
and date for
receipt of
completed
Application
Forms and
payment in
full under the
Open Offer or
settlement of
relevant
CREST
instructions
(as
appropriate)
Court hearing 16 November 2016
to consider
sanctioning
the Scheme
Chapter 15 17 November 2016
hearing to
obtain New
York
recognition of
the English
judgment in
relation to
the Scheme
Announcement 17 November 2016
of the
results of the
Placing and
Open Offer
Effective date 21 November 2016
of the
Scheme
LSE Admission 8.00 a.m. on 21 November 2016
and
commencement
of dealings in
respect of New
Ordinary
Shares and
CREST stock
accounts
credited in
respect of New
Ordinary
Shares
Stockholm on or around 21 November 2016
Admission and
commencement
(for normal
settlement) of
dealings in
respect of
New Ordinary
Shares
Despatch of on or around 28 November 2016
share
certificates
in respect of
New Ordinary
Shares in
certificated
form
Notes:
(1) References to times are to London time unless otherwise stated.
(2) The ability to participate in the Placing and Open Offer is subject
to certain restrictions relating to Shareholders with a registered address or
located or resident outside the UK or Sweden, details of which are set out in
Part 10 ("Terms and Conditions of the Placing and Open Offer") of the
Prospectus.
(3) If you have any queries on the procedure for acceptance and payment
in respect of the Open Offer or on the procedure for splitting Application
Forms, you should refer to Part 10 ("Terms and Conditions of the Placing and
Open Offer") of the Prospectus, which contains the Terms and Conditions of the
Placing and Open Offer. Should you require further assistance please call Capita
Asset Services on 0371 664 0321. Calls are charged at the standard geographic
rate and will vary by provider. Calls outside the United Kingdom will be charged
at the applicable international rate. The helpline is open between 9.00 a.m. to
5.30 p.m., Monday to Friday excluding public holidays in England and Wales.
Please note that Capita Asset Services cannot provide any financial, legal and
tax advice and calls may be recorded and monitored for security and trading
purposes.
APPENDIX III –DEFINITIONS
Ad Hoc Noteholder the informal ad hoc committee of the Existing
Committee High Yield Noteholders from time to time
Admission LSE Admission and Stockholm Admission
Amended Retail Notes the Existing Retail Notes, as amended by the
Proposed Note Amendments
Application Form the personalised application form being sent to
Qualifying Non-CREST Shareholders for use in
connection with the Open Offer
Board the board of directors of the Company
Boepd barrels of oil equivalent per day
Bookbuild the accelerated bookbuild carried out by the
Joint Bookrunners in which the identity of Placees
and allocation of New Ordinary Shares to be
issued pursuant to the Placing were determined
Committed Shares the Open Offer Shares which Double A Limited, a
company beneficially owned by the extended family
of Amjad Bseisu, and the Trustees have
irrevocably undertaken to apply for under the Open
Offer pursuant to the irrevocable undertakings
as described in this announcement
Company or EnQuest the public limited company named EnQuest PLC
with company number 07140891 and with registered
office address at 5th Floor Cunard House, 15
Regent Street, London, SW1Y 4LR
CREST the UK-based system for the paperless settlement
of trades in listed securities, of which Euroclear
UK & Ireland is the operator
Disclosure Guidance Rules the Disclosure Guidance and Transparency Rules
of the Financial Conduct Authority
Double A Limited company beneficially owned by the extended
family of Amjad Bseisu
Double A Placing Letter the placing letter between the Joint Bookrunners
and Double A Limited dated 13 October 2016
Euroclear UK & Ireland Euroclear UK & Ireland Limited, the operator of
CREST
Excluded Australia, Canada, Japan, the Republic of
Territory/Territories South Africa and any other jurisdiction where the
extension or availability of the Placing and
Open Offer (and any other transaction
contemplated thereby) would breach applicable law
Existing High Yield the $650,000,000 7% senior notes due 15 April
Notes 2022 issued by the Company
Existing Noteholders the Existing High Yield Noteholders and the
Existing Retail Noteholders
Existing Notes the Existing High Yield Notes and the Existing
Retail Notes
Existing Ordinary Shares the Ordinary Shares in issue at the date of this
announcement
Existing RCF the senior secured revolving credit facility
dated as of 6 March 2012, as amended, restated or
otherwise modified or varied from time to time,
entered into by, among others, EnQuest, as the
borrower, BNP Paribas, as facility agent, and
certain lenders party thereto
Existing RCF Lenders the original lenders under the Existing RCF and
any lender which has acceded as a lender
thereunder, which in either case has not ceased
to be a party to the Existing RCF in accordance
with the terms
Existing Retail the holders of the Existing Retail Notes
Noteholders
Existing Retail Notes the £155,000,000 5.5% notes due 15 February 2022
issued by the Company under its £500,000,000 euro
medium term note programme
Explanatory Statement the explanatory statement in respect of the
Scheme
EU Market Abuse the Market Abuse Regulation (EU) No 596/2014
Regulation
Final Placing the final allocation of New Ordinary Shares to
Participation be issued to a Placee pursuant to the Placing
FSMA the UK Financial Services and Markets Act 2000
(as amended)
General Meeting the extraordinary general meeting of the Company
to be held at Ashurst LLP, Broadwalk House, 5
Appold Street, London, EC2A 2HA on 14 November
2016 at 9.00 a.m.
Group the Company and its subsidiaries and subsidiary
undertakings from time to time
Issue Price 23 pence per New Ordinary Share (SEK 2.48 per
New Ordinary Share for Qualifying Swedish
Shareholders in the Swedish Open Offer)
Joint Bookrunners Merrill Lynch International and J.P. Morgan
Cazenove
Letter of Confirmation the letter of confirmation attached to the
Placing Letter
Letter of Credit the letter of credit to be issued by Credit
Suisse AG in favour of the Company in connection
with Double A’s participation in the Placing
Listing Rules the listing rules of the Financial Conduct
Authority made under Part VI of the FSMA
London Stock Exchange London Stock Exchange plc
LSE Admission admission of the New Ordinary Shares to the
premium listing segment of the Official List in
accordance with the Listing Rules and/or
admission to trading on the Main Market of the
London Stock Exchange becoming effective in
accordance with the Admission and Disclosure
Standards, as the context may require
Main Market the London Stock Exchange's main market for
listed securities
MMbbl millions of barrels, i.e. oil barrels
corresponding to 159 litres
NASDAQ Stockholm NASDAQ Stockholm AB's main market
New High Yield Notes the new $650,000,000 7% senior notes issued by
the Company to the Existing High Yield Noteholders
in exchange for the Existing High Yield Notes on
a dollar-for-dollar basis
New Ordinary Shares 356,738,114 new Ordinary Shares to be issued by
the Company pursuant to the Placing and Open Offer
October Interest Payment the interest payment due on the Existing High
Yield Notes on 17 October 2016
Official List the Official List maintained by the Financial
Conduct Authority
Open Offer the offer to Qualifying Shareholders
constituting an invitation to apply for the Open
Offer Shares on the terms and subject to the
conditions set out in this document, and in the
case of Qualifying Non-CREST Shareholders, the
Application Form
Open Offer Entitlements an entitlement of a Qualifying Shareholder to
apply for 4 Open Offer Shares for every 9 Existing
Ordinary Shares held by him or her on the Record
Date pursuant to the Open Offer
Open Offer Shares the New Ordinary Shares to be offered to
Qualifying Shareholders pursuant to the Open Offer
and (other than the Committed Shares) to Placees
pursuant to the Placing
Ordinary Shares the ordinary shares of 5 pence each in the
capital of the Company
Placees any persons (including Double A Limited) who
have agreed or shall agree to subscribe for Open
Offer Shares pursuant to the Placing subject to
clawback to satisfy valid applications by
Qualifying Shareholders pursuant to the Open
Offer
Placing the conditional placing of the Open Offer Shares
(other than the Committed Shares) with Placees,
subject to clawback to satisfy valid
applications by Qualifying Shareholders under the
Open Offer
Placing and Open Offer the Placing and Open Offer
Placing Letter the letter to be completed and signed by Placees
in connection with the Placing
Placing Proof Prospectus the placing proof of the Prospectus expected to be
dated on or around 13 October 2016
Placing Terms Agreement the agreement to be entered into by the Company
and the Joint Bookrunners recording, amongst
other things, the outcome of the Bookbuild
PM8/Seligi Production the production sharing contract between EP
Sharing Contract Malaysia, PETRONAS Carigali Sdn Bhd, E&P Malaysia
Venture Sdn Bhd (as contractors) and PETRONAS
dated 10 December 2014, as discussed in this
announcement
Pre-Printed Issue Account the personalised pre-printed issue account
Statement statement being sent to Qualifying Swedish
Directly Registered Shareholders for use in
connection with the Swedish Open Offer
Pricing Information the pricing information expected to be published
in a placing results announcement on or around
13 October 2016
Proposed Note Amendments certain amendments of the Existing Notes, and
issue of the Warrants, as discussed in this
announcement
Proposed RCF Amendments certain amendments of the Existing RCF, as
discussed in this announcement
Prospectus the prospectus to be issued by the Company in
respect of the Placing and Open Offer, together
with any supplements or amendments thereto
Prospectus Directive EU Prospectus Directive (2003/71/EC), as
amended, and includes any relevant implementing
measure in each relevant member state
Prospectus Rules the Prospectus Rules of the Financial Conduct
Authority made under Part VI of the FSMA
Provisional Placing each prospective Placee’s provisional allocation
Participation of New Ordinary shares (subject to clawback in the
Open Offer)
Prudential Regulation the UK Prudential Regulation Authority
Authority
Qualifying CREST Qualifying Shareholders whose Ordinary Shares on
Shareholders the register of members of the Company at the
close of business on the Record Date are in
uncertificated form
Qualifying Non-CREST Qualifying Shareholders whose Ordinary Shares on
Shareholders the register of members of the Company at the
close of business on the Record Date are in
certificated form
Qualifying Shareholders holders of Existing Ordinary Shares on the
register of members of the Company at 6.00 p.m. on
the Record Date
Qualifying Swedish holders of Existing Ordinary Shares listed on
Directly Registered NASDAQ Stockholm in VP Accounts in their own
Shareholders name at the close of business on the Record Date
Qualifying Swedish holders of Existing Ordinary Shares listed on
Nominee Registered NASDAQ Stockholm held with a bank or other
Shareholders nominee at the close of business on the Record
Date
Qualifying Swedish Qualifying Swedish Directly Registered
Shareholders Shareholders and Qualifying Swedish Nominee
Registered Shareholders
Record Date 19 October 2016
Regulation S Regulation S under the Securities Act
Resolutions the resolutions set out in the notice of General
Meeting
Restructuring the financial restructuring as proposed by the
Company, as discussed in this announcement
Scale Back the reduction (if any) in the Participation of
Double A Limited in the Placing
Scheme the proposed scheme of arrangement under Part 26
of the Companies Act between the Company and the
Scheme Creditors to implement the Proposed Note
Amendments with, or subject to, any modification,
addition or condition which the Court may
consider fit to approve or impose
Scheme Creditors includes each Existing High Yield Noteholder and
each Existing Retail Noteholder
Securities Act the United States Securities Act of 1933, as
amended
SEK the lawful currency of Sweden
Shareholders the holders of Ordinary Shares in the capital of
the Company
Sponsor and Placing the sponsor, placing and open offer agreement
Agreement between the Company and the Joint Bookrunners
dated 13 October 2016
Stockholm Admission admission of the New Ordinary Shares to trading
on NASDAQ Stockholm
Sullom Voe Terminal or SVT the oil terminal located in the Shetland Islands
that receives oil from the Brent and Ninian
pipeline systems
Surety Bond Facilities The surety bonds provided by the Surety Bond
Providers aggregating to £89.2 million and $5.0
million, of which £2.0 million mature in
September 2016 and with the remaining amount
maturing in December 2016
Surety Bond Providers HCC International Insurance Company PLC and
Liberty Mutual Insurance Europe
Swedish Application Form the application form attached to the Pre-Printed
Issue Account Statement being sent to Qualifying
Swedish Directly Registered Shareholders for use
in connection with the Swedish Open Offer
Swedish Issuer Agent Skandinaviska Enskilda Banken AB
Swedish Open Offer the offer to Qualifying Swedish Shareholders
constituting an invitation to apply for the Open
Offer Shares, and in the case of Qualifying
Swedish Directly Registered Shareholders, the
Pre-Printed Issue Account Statement and the
Swedish Application Form
Tanjong Baram Risk the contract dated 27 March 2014 between the
Service Contract Group, Uzma and PETRONAS to develop and produce
the Tanjong Baram field for a period up to March
2023
Trustees Capita Trustees Limited, acting in their
capacity as trustees of the EnQuest EBT
UKCS United Kingdom Continental Shelf
United Kingdom or UK the United Kingdom of Great Britain and Northern
Ireland
United States or US the United States of America, its territories
and possessions, any state of the United States of
America, and the District of Columbia
US$ or $ or USD or US US dollars, the lawful currency of the United
dollars States
£ or pounds sterling or pounds sterling, the lawful currency of the
sterling or GBP United Kingdom
Issue of Equity
| Source: EnQuest PLC
Attachments
