The Vijay Sheth-promoted Great Offshore (GOL) is believed to be taking over Norwegian offshore company PetroJack in a $500-million deal.
Interestingly, the Chennai-based Aban Offshore will be a major beneficiary from the deal, since it owns considerable stake in PetroJack through Sinvest of Norway, acquired by Aban in 2006. The deal is likely to be closed within a couple of weeks. ET first reported about the impending acquisition on August 8, 2007.
Formed by Norway’s leading businessman Berge Gerdt Larsen in 2004, PetroJack is listed on the Oslo Stock Exchange since February 2005. It has two identical jack-up rigs currently under construction at Jurong Shipyard, a subsidiary of SembCorp Marine, one of the major ship and rig builders in Singapore.
The Aban Offshore stock closed 2.8% down at Rs 2,595.05 on BSE on Friday on a day when the Sensex ended 1.5% down. Great Offshore was down 0.8% at Rs 772.30. The PetroJack share price is hovering around 22 Norwegian Krone (NOK) or $3.7 a share, at current prices.
The shareholder structure in PetroJack is locked with Awilco and Sinvest — now owned by Aban Offshore through its Singapore subsidiary, and its initial promoter Mr Larsen. While Awilco and Sinvest own around 18% each in PetroJack, Mr Larsen — also founder of Petromena, PetroProd and Petrolia Drilling — and related parties control most of the remaining shares. Sinvest had made a hostile takeover bid on PetroJack a few years ago, but the effort turned futile, according to industry officials.
Vijay Sheth, managing director, GOL, refused to comment on the deal. Senior officials at Aban Offshore, too, refused to comment.Martin Huseby Karlsen, an equity analyst based in Oslo, told ET that PetroJack is the only Norwegian company left with two jack-ups after the acquisition of Mosvold Jack-up by SeaWolf. In addition to two jack-ups under construction at Jurong, PetroJack has ownership stakes in three related companies — Petrolia Drilling, Petromena and PetroProd, all of which were founded by Mr Larsen.
Over the past few months, several international buyers held parleys with PetroJack to acquire their rigs, with most parties willing to pay $210 million to $220 million per rig. The rigs are to be delivered in first and fourth quarters of 2008.
According to offshore analysts, the implied rig value of PetroJack is $192 million per rig by 2008-end. According to sources, GOL is believed to have taken a look at another Norwegian company as well — Scorpion Offshore. Scorpion currently has six jack-ups under construction. Scorpion, whose market cap hovers around $630 million, has a fairly open shareholder structure.
Indian offshore companies are frantically acquiring rigs and offshore assets to cash in on the boom. Aban Offshore was the first company to go abroad to take over a Norwegian company Sinvest in a $1.4-billion deal. “Demand for jack-up rigs has shot up substantially, with new oil/gas discoveries. A new-build jack-up rig fetches steady charter hire of around $200,000 per day. A new rig may cost up to $250 million depending on the specifications,” said an industry official.
GOL was created by demerging the offshore division of Great Eastern Shipping Company (GE Shipping), India’s largest private shipping company, following a long family feud. The GOL board, which met on July 30, discussed various fund-raising options ahead of the takeover. The sources said the board had cleared a proposal to issue foreign currency convertible bonds (FCCBs) worth $40 million.
For GOL, fleet expansion has been a top priority, as many contracts are waiting to be grabbed in India’s fast-growing gas/oil exploration sector. GOL recently bagged a major 5-year contract early July from the state-owned ONGC. The contract, which is slated to commence from May 2009, is valued at around Rs 1,000 crore.
Interestingly, the Chennai-based Aban Offshore will be a major beneficiary from the deal, since it owns considerable stake in PetroJack through Sinvest of Norway, acquired by Aban in 2006. The deal is likely to be closed within a couple of weeks. ET first reported about the impending acquisition on August 8, 2007.
Formed by Norway’s leading businessman Berge Gerdt Larsen in 2004, PetroJack is listed on the Oslo Stock Exchange since February 2005. It has two identical jack-up rigs currently under construction at Jurong Shipyard, a subsidiary of SembCorp Marine, one of the major ship and rig builders in Singapore.The Aban Offshore stock closed 2.8% down at Rs 2,595.05 on BSE on Friday on a day when the Sensex ended 1.5% down. Great Offshore was down 0.8% at Rs 772.30. The PetroJack share price is hovering around 22 Norwegian Krone (NOK) or $3.7 a share, at current prices.
The shareholder structure in PetroJack is locked with Awilco and Sinvest — now owned by Aban Offshore through its Singapore subsidiary, and its initial promoter Mr Larsen. While Awilco and Sinvest own around 18% each in PetroJack, Mr Larsen — also founder of Petromena, PetroProd and Petrolia Drilling — and related parties control most of the remaining shares. Sinvest had made a hostile takeover bid on PetroJack a few years ago, but the effort turned futile, according to industry officials.
Vijay Sheth, managing director, GOL, refused to comment on the deal. Senior officials at Aban Offshore, too, refused to comment.Martin Huseby Karlsen, an equity analyst based in Oslo, told ET that PetroJack is the only Norwegian company left with two jack-ups after the acquisition of Mosvold Jack-up by SeaWolf. In addition to two jack-ups under construction at Jurong, PetroJack has ownership stakes in three related companies — Petrolia Drilling, Petromena and PetroProd, all of which were founded by Mr Larsen.
Over the past few months, several international buyers held parleys with PetroJack to acquire their rigs, with most parties willing to pay $210 million to $220 million per rig. The rigs are to be delivered in first and fourth quarters of 2008.
According to offshore analysts, the implied rig value of PetroJack is $192 million per rig by 2008-end. According to sources, GOL is believed to have taken a look at another Norwegian company as well — Scorpion Offshore. Scorpion currently has six jack-ups under construction. Scorpion, whose market cap hovers around $630 million, has a fairly open shareholder structure.
Indian offshore companies are frantically acquiring rigs and offshore assets to cash in on the boom. Aban Offshore was the first company to go abroad to take over a Norwegian company Sinvest in a $1.4-billion deal. “Demand for jack-up rigs has shot up substantially, with new oil/gas discoveries. A new-build jack-up rig fetches steady charter hire of around $200,000 per day. A new rig may cost up to $250 million depending on the specifications,” said an industry official.
GOL was created by demerging the offshore division of Great Eastern Shipping Company (GE Shipping), India’s largest private shipping company, following a long family feud. The GOL board, which met on July 30, discussed various fund-raising options ahead of the takeover. The sources said the board had cleared a proposal to issue foreign currency convertible bonds (FCCBs) worth $40 million.
For GOL, fleet expansion has been a top priority, as many contracts are waiting to be grabbed in India’s fast-growing gas/oil exploration sector. GOL recently bagged a major 5-year contract early July from the state-owned ONGC. The contract, which is slated to commence from May 2009, is valued at around Rs 1,000 crore.
Via: India Economic Times
