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SeaBird Exploration Plc ("SeaBird" or the "Company") is pleased to announce that the Company is in an exclusive process to acquire the seismic vessels BOA Galatea and BOA Thalassa (the "BOA Vessels") in a transaction which values the vessels at NOK 185 million on an en-bloc basis (the "Transaction"). The BOA Vessels are well suited for source and 2D operations, as well as EM seabed logging, for which BOA Thalassa is currently contracted with EMGS ASA until September 2019 with options for EMGS ASA to extend for three periods of six months each.

In order to finance the acquisition of the BOA Vessels, as well as to finance an upgrade of BOA Galatea to high end 2D / source capability, the Company is contemplating a private placement of new shares (the "Offer Shares") in the Company raising gross proceeds of minimum NOK 225 million and maximum of NOK 250 million (the "Private Placement"). The subscription price (the "Offer Price") in the Private Placement will be determined through an accelerated book-building process. 

Transaction Summary 

The Company is in an exclusive process for the acquisition of BOA Galatea and BOA Thalassa. The BOA Vessels are owned by BOA SBL AS, a subsidiary of BOA Offshore AS, and the process is based on irrevocable acceptances from a majority of BOA SBL bondholders. ABG Sundal Collier ASA and Fearnley Securities AS act as financial advisors to the Company in connection with the acquisition of the BOA Vessels.

As part of the Transaction, certain BOA SBL bondholders have elected to receive consideration in the form of new shares of the Company valued at the Offer Price for an amount corresponding to approximately NOK 54 million, which will come in addition to the Private Placement. 

BOA Galatea and BOA Thalassa were built in 2008 and 2009, respectively, at Norwegian yard for an original construction cost of approximately NOK 650m in total. Both vessels are rigged and fully operational as EM vessels, and are well suited for upgrade to high end 2D / source capability. The Company estimates such upgrade to cost approximately USD 11 million per vessel. The net investment for BOA Galatea is expected to be limited to USD 8 million, as the Company can use existing unutilised equipment in the upgrade.

The process to acquire the BOA Vessels is conditional upon final and irrevocable agreement to acquire the vessels or their holding companies by the Company. The process is supported by an irrevocable undertaking by a majority of BOA SBL bondholders. 

Hans Petter Klohs, Chief Executive Officer in SeaBird, said: "As a consequence of increased demand in all our regions, we have had to turn down work in the first quarter of 2019 due to scheduling conflicts. To be able to pursue a strong and diversified pipeline of contract leads in all segments, we have been evaluating several attractive opportunities for vessel capacity expansion. The BOA Galatea and BOA Thalassa will be excellent additions to our operational fleet, being ideally suited for source and 2D operations in addition to EM seabed logging. We are excited to have developed this transaction which will provide us with two very suitable quality vessels at a very attractive price further strengthening our position and service offering in the 2D, source and niche 3D markets." 

The Private Placement 

ABG Sundal Collier ASA, Fearnley Securities AS and SpareBank 1 Markets AS have been engaged as Joint Lead Managers and Bookrunners and Norne Securities as Co-Manager for the Private Placement (the "Managers"). 

The Private Placement will be carried out on the following terms: 

  • The application period for the Private Placement opens today at 16:30 CET on 11 April 2019 and closes at 08:00 CET on 12 April 2019. The Company, in consultation with the Managers, may however at any time resolve to close or extend the subscription period at its sole discretion and on short notice.
  • The minimum subscription and allocation amount in the Private Placement will be the NOK equivalent of EUR 100,000, provided that the Company may, at its sole discretion, allocate an amount below EUR 100,000 to the extent applicable exemptions from the prospectus requirement pursuant to applicable regulations are available.
  • Allocation of the Offer Shares will be determined at the end of the application period, and final allocation will be made by the Company's Board of Directors at its sole discretion. Notification of the conditional allocation is expected to be sent by the Managers on or about 12 April 2019.
  • The settlement date is expected to be during week 18 (week commencing on 29 April 2019), subject to (i) the Board of Directors of the Company having resolved to issue the shares and (ii) final irrevocable agreement to acquire the BOA Vessels or their holding companies by the Company or positive bondholders resolution in relation to the acquisition of the BOA Vessels by the Company. If these conditions have not been met by 31 May 2019, the Private Placement will be cancelled.
  • The Offer Shares will be temporarily issued on a separate ISIN, for which arrangements will be made for interim trading on Merkur Market. These shares will be converted to the Company's original ISIN number and listed on Oslo Børs upon the approval of a listing prospectus (the "Prospectus") by the Norwegian Financial Supervisory Authority ("NFSA"), currently expected to take place in early June 2019.
  • The Company and the Managers reserve the right, at any time and for any reason, to cancel and/or modify the terms of the Private Placement. 

The Company has received significant indications of interest from existing shareholders and new investors, including subscriptions from members of the Board and the Company's management, as follows: 

  • Chairman of the Board Heidar Engebret, through his wholly owned company Oppsiden Invest AS, has pre-committed to subscribe for Offer Shares for NOK 500,000
  • Board member Dag Fredrik Arnesen, through his wholly owned company Storkleiven AS, has pre-committed to subscribe for 500,000 Offer Shares
  • Board member Ketil Nereng, through his wholly owned company Acme AS, has pre-committed to subscribe for Offer Shares for NOK 1,250,000
  • Board member Olav Haugland, through his 50% owned company Skalmen AS, has pre-committed to subscribe for Offer Shares for NOK 300,000
  • CEO Hans Petter Klohs, through his wholly owned company Carthea AS, has pre-committed to subscribe for 280,000 Offer Shares
  • COO Finn Atle Hamre, through his wholly owned company Orion Offshore AS, has pre-committed to subscribe for Offer Shares for NOK 300,000 

The Board, together with the Company's management and the Managers, has considered various transaction alternatives to secure new financing. Based on an overall assessment, taking into account inter alia the need for funding, execution risk and possible alternatives, the Board has on the basis of careful considerations decided that the Private Placement is the alternative that best protects the Company's and the shareholders' joint interests. Thus, the waiver of the preferential rights inherent in a share capital increase through issuance of new shares is considered necessary. 

Subject to completion of the Private Placement, the Company intends to carry out a subsequent repair offering to its existing shareholders as of close of trading 11 April 2019, as subsequently recorded in the VPS on 15 April 2019, who were not allocated shares in the Private Placement. 

Updated company presentation 

The Company has made available an updated company presentation on its website, which can be found on http://www.sbexp.com/investor-relations/presentations-and- webcasts

For further information, please contact: 

Hans Petter Klohs 
CEO SeaBird Exploration 
Phone: +47 22 40 27 18   

Nils Haugestad
CFO SeaBird Exploration
Phone: +47 22 40 27 17   

Contact information for the Managers: 

ABG Sundal Collier ASA
Telephone: +47 22 01 60 08   

Fearnley Securities AS

Telephone: +47 22 93 63 98   

SpareBank 1 Markets AS
Telephone: +47 24 14 74 70   

Norne Securities
Telephone: +47 55 55 91 37 


SBX - Company Presentation