Global law firm White & Case LLP has advised FTSE 250 oil & gas company Afren plc on its recommended acquisition of the Toronto listed exploration company Black Marlin Energy Holdings Limited.
Afren is an exploration and production company that, prior to the acquisition, held 15 assets across five West African countries spanning the full cycle E&P value chain, providing the company with net production of approximately 20,000 boepd and net reserves and resources in excess of 1.2 billion boe. The acquisition of Black Marlin has delivered to Afren a core multi-country platform in East Africa, comprising 12 assets across Kenya, Ethiopia, Madagascar and the Seychelles, increasing its pan African presence to 27 assets across nine countries.
The offer gave Black Marlin shareholders 0.367 Afren shares for each Black Marlin Share, valuing them at C$0.51 per share, putting the total valuation of Black Marlin at C$106.5 million (approximately £70 million). Following the acquisition, Black Marlin has become a wholly owned subsidiary of Afren.
The transaction was a class 1 transaction for Afren under the UK Listing Rules and was structured as a BVI scheme of arrangement using share consideration. The acquisition was conditional on the approval by holders of at least 75 percent of Black Marlin shares (which was received on 10 September 2010), a majority of Afren shareholders voting in favour (which was received at Afren’s shareholder general meeting held on 21 September 2010) and court approval of the scheme in British Virgin Islands (which was received on 6 October 2010). The transaction completed on 7 October 2010 and the Afren shares issued to Black Marlin shareholders were admitted to the Official List of the UK Listing Authority and to trading on the London Stock Exchange’s main market for listed securities on 8 October 2010.
“This deal is yet another example of ongoing consolidation of the oil and gas market,” said London corporate partner Allan Taylor. “We’re seeing a hunt for assets in oil and gas, and a consolidation in exploration plays on the African continent.” Allan Taylor added, “This deal continues to consolidate White & Case’s position on African work. It follows our recent work on one of the biggest-ever IPOs on the South African stock exchange, the offering of the Life Healthcare Group.”
White & Case previously advised Afren on its move from AIM to the main London market in late 2009.
The White & Case LLP team was led by London Corporate partner Allan Taylor, assisted by senior associate, Nikhil Narayanan, and associates Adnan Chida, Jaroslaw Czernek and Tamara Kilner. Offshore firm Appleby Global advised Afren on the BVI aspects of the deal and Torys in Toronto advised on Canadian M&A regulations.
