RAK Petroleum PCL Announces Agreement to Acquire Gulf Keystone Petroleum Limited
Transaction highlights:
• All cash consideration of 74 pence for each issued and to be issued Gulf Keystone share, representing an aggregate consideration of £208 million
• Recommended by Gulf Keystone’s Board of Directors
• RAK Petroleum has received irrevocable undertakings to vote in favour of the acquisition from approximately 33% of Gulf Keystone’s issued share capital
• Complementary to RAK Petroleum’s recent acquisition of Indago Petroleum’s assets.
Ras Al Khaimah, April 13, 2007 – RAK Petroleum PCL (“RAK Petroleum”) announced today that it has entered into an agreement with Gulf Keystone Petroleum Limited (“Gulf Keystone”) to acquire all of the issued and to be issued share capital of Gulf Keystone.
The transaction is recommended by the Board of Directors of Gulf Keystone, who have given irrevocable undertakings to vote in favour of the acquisition. The transaction, which will be effected through an amalgamation under Bermuda law, is subject to certain conditions, including the approval by a simple majority of Gulf Keystone shareholders in a general meeting and Algerian regulatory consents.
The acquisition contributes further to RAK Petroleum’s aim of developing into a major regional gas and oil player and will add to the recently announced Indago Petroleum’s assets.
Abdul Aziz Al Ghurair, Chairman of RAK Petroleum, commented, “We are delighted to have reached agreement on the acquisition of Gulf Keystone. When combined with our recently completed acquisition of Indago Petroleum’s assets, we believe this creates a strong platform for future growth within the strategic focus areas of RAK Petroleum, especially in the gas rich provinces of the Middle East and North Africa.”
The acquisition represents a premium of approximately 21 per cent to the average closing price of approximately 61 pence per share of Gulf Keystone, for the three month period ended on February 05, 2007, the last dealing day prior to the date of Gulf Keystone’s announcement that it was in discussions regarding a possible transaction.
The deal emphasizes the implementation of the core strategy of securing access to attractive gas and oil reserves in the Middle East and North Africa.
RAK Petroleum has received irrevocable undertakings to vote in favour of the Amalgamation Resolution from the Directors, Gulf Keystone Petroleum Co. LLC, GIBCA, Ali Al-Qabandi and Ibrahim Al-Khaldi in respect of 90,973,366 Gulf Keystone shares (representing approximately 33 percent of the Gulf Keystone issued share capital). RAK Petroleum also announced last month that it has reached an agreement with Indago Petroleum Limited on an all cash consideration of £194 million to purchase substantially all of Indago Petroleum’s exploration and production assets, which are located in the UAE and Oman.
The Gulf Keystone transaction builds a diverse portfolio of reserves around the experienced UAE-based management team acquired with the Indago assets and the investment that RAK Petroleum holds in Anzon Energy Ltd. Together, the three operations offer an attractive portfolio of technical expertise, production and development assets that are complementary to RAK Petroleum’s regional and international ambitions, relationships and financial capacity.
Goldman Sachs International acted as sole financial advisor to RAK Petroleum.
-RAK Petroleum is an unlisted public company incorporated in the Ras Al Khaimah Free Zone, and was established in late 2005, funded by an initial capital of approximately AED 3 billion raised by private placement. RAK Petroleum has a further unissued authorised capital allocation of AED 2 billion to be utilised in future fundraisings. The vast majority of RAK Petroleum's issued share capital is held in the United Arab Emirates and Saudi Arabia.
RAK Petroleum was founded with the objective of initiating, participating, investing and developing energy related projects, assets, ventures and businesses in the highly prospective Gulf Cooperation Council markets and beyond. RAK Petroleum is strategically focused on developing into an international, integrated oil and gas company.
The RAK Petroleum board of directors is chaired by Mr Abdul Aziz Al Ghurair who is also the Chairman of Mashreqbank PSC and was recently elected Speaker of the House of the 14th Legislative Chapter of the Federal National Council in the United Arab Emirates.
About Gulf Keystone Petroleum Limited
Gulf Keystone is an independent company set up to explore, develop and produce oil and gas - primarily in North Africa and the Middle East. Listed on the Alternative Investment Market (AIM) of the London Stock Exchange, Gulf Keystone is focused on under-developed oil and gas fields that can be exploited economically and profitably.
The company currently has exploration and appraisal rights to nine blocks totalling 33,216 square kilometres in the Republic of Algeria. Eight of the blocks have been won in the past year; six in the Sixth Algerian Licensing Round and a further two in direct negotiation with the Algerian Ministry of Energy and Mines.
These holdings offer real potential in terms of pre-existing discoveries and probable oil and gas reserves. Gulf Keystone intends to realise this potential with a programme of drilling appraisals and development wells. Independent estimates of the company's holdings suggest reserves of 3.9 billion barrels of oil equivalent in place.
Goldman Sachs International, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for RAK Petroleum PCL and for no-one else in connection with the transaction and will not be responsible to anyone other than RAK Petroleum PCL for providing the protections afforded to clients of Goldman Sachs International or any advice in relation to the transaction nor any other matter referred to in this announcement.
