Correction - Dolphin Drilling AS: Contemplated Private Placement
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART DIRECTLY OR INDIRECTLY, IN AUSTRALIA, CANADA, JAPAN, HONG KONG, SOUTH AFRICA OR THE UNITED STATES OR ANY OTHER JURISDICTION IN WHICH THE RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF ANY OF THE SECURITIES DESCRIBED HEREIN.
Oslo, 22 June 2023) Dolphin Drilling AS (the "Dolphin Drilling" or the "Company") has retained Arctic Securities AS, Clarksons Securities AS, DNB Markets, a part of DNB Bank ASA, Fearnley Securities AS and Pareto Securities AS as joint bookrunners (jointly, the "Managers") to advise on and effect a private placement of new shares (the "Offer Shares") raising the NOK equivalent of approximately USD 60 million (the "Private Placement"). The subscription price per Offer Share in the Private Placement (the "Subscription Price") will be determined by the Company's board of directors (the "Board") on the basis of an accelerated book building process conducted by the Managers.
The net proceeds to the Company from the Private Placement will be used to partially finance the acquisition of Paul B. Loyd Jr. and Transocean Leader (the "Transaction"), for working capital and other Transaction related costs, as well as for general corporate purposes.
The bookbuilding period for the Private Placement opens today at 16:30 CEST and closes on 23 June 2023 at 08:00 CEST (the "Application Period"). The Company reserves the right to shorten, close or extend the Application Period at any time and for any reason on short, or without notice. The minimum order size and allocation in the Private Placement will be the NOK equivalent of EUR 100,000, provided that the Company may, at its sole discretion, allocate Offer Shares for an amount below the NOK equivalent of EUR 100,000 to the extent applicable exemptions from relevant prospectus requirements are available.
Two of the Company's largest shareholders, Strategic Value Partners LLC ("SVP") and S.D. Standard ETC Plc ("SDS"), are supportive of the transaction and have pre-committed to subscribe for, and will be allocated, approx. USD 13 million and USD 7 million of the Private Placement, respectively. Certain members of the Company's management have pre-committed to subscribe for, and will be allocated, approx. USD 0.235 million in the Private Placement. Allocation of Offer Shares will be made at the sole discretion of the Board in consultation with the Managers after expiry of the Application Period (subject to any shortening or extension).
The Offer Shares will be settled with existing and unencumbered shares in the Company that are already listed on Euronext Growth Oslo, pursuant to an agreement entered into between certain Managers, the Company, SVP and SDS (the "Agreement"). The shares delivered to the subscribers will thus be tradable upon delivery subject to conditions having been met. The shares delivered to the subscribers will thus be tradable upon delivery subject to conditions having been met. Expected first day of trading will be on or about 30 June (X) subject to conditions being met, and settlement is expected on or about on or about 4 July (DVP X+2).
Completion of the Private Placement by allocation and delivery of the Offer Shares to investors is subject to (i) the Board resolving to consummate the Private Placement and conditionally allocate the Offer Shares, (ii) approval by the Company’s extraordinary general meeting ("EGM") of the Private Placement, the issue of the new A-shares and the share capital reduction; (iii) the Agreement remaining unmodified and in full force and effect, and (iv) binding agreements for the Transaction being validly entered into by the parties thereto, including signed letter of agreement to consent (on satisfaction of conditions) for sale of the rigs and novation by the counterparties to the drilling contracts.
Subject to relevant approvals by the EGM, SVP and SDS have undertaken to use the full proceeds received from the settlement of the Private Placement, in addition to the consideration payable for Offer Shares allocated to SVP and SDS, to acquire new A-shares in the Company. The number of A-shares to be issued will be 1 A-share per 10 Offer Shares allocated in the Private Placement, but with 10 times the number of votes and economic benefits compared to the ordinary shares, and will be issued at a price per A-share equal to 10 times the price per Offer Share. The purpose is to enable the Company to complete the Private Placement at an Offer Price which is below the nominal value of the existing ordinary shares. All of the new A-shares will be converted into ordinary shares by way of a 1:10 share split as soon as practically possible (following completion of a share capital reduction by way of reducing the nominal value of the Company's shares). The conversion is expected to take place within an overall timeline of eight (8) weeks from the settlement date, including a 6 weeks' creditor notification period. Following such conversion, the new A-shares (as converted to ordinary shares) will rank pari passu with the other shares in the Company.
SVP, SDS and certain primary insiders of the Company have entered into customary lock-up arrangements with the Managers that, subject to customary exceptions, will restrict their ability to, without the prior written consent of the Managers, issue, sell or dispose of shares, as applicable, for a period of 180 days after the date hereof.
The Company may, subject to completion of the Private Placement and certain other conditions, decide to carry out a subsequent repair offering of new shares at the Subscription Price (the "Subsequent Offering") which, subject to applicable securities laws, will be directed towards existing shareholders in the Company as of 22 June 2023 (as registered in the VPS two trading days thereafter) who (i) were not included in the wall-crossing phase of the Private Placement, (ii) were not allocated Offer Shares in the Private Placement, and (iii) are not resident in a jurisdiction where such offering would be unlawful, or would (in jurisdictions other than Norway) require any prospectus filing, registration or similar action. The launch of the Subsequent Offering, if carried out, will also be contingent on, inter alia, approval by the EGM, completion of the share capital reduction and publication of a prospectus.
The Board has considered the Private Placement in light of the equal treatment obligations under applicable regulations and is of the opinion that the waiver of the preferential rights inherent in a private placement, taking into consideration the time, costs and risk of alternative methods of the securing the desired funding, is in the common interest of the shareholders of the Company. The Board considers that although the Private Placement will imply a dilution of the existing shareholders of the Company, the existing shareholders, to the extent possible, will be given the opportunity to participate in, and be allocated shares in the Private Placement. Further, the subsequent repair offering, if implemented, will secure that eligible shareholders receive the opportunity to subscribe for new shares at the same subscription price as that applied in the Private Placement, and hence mitigate the effect of the Private Placement. Taking these factors into consideration, the Board is of the view that the Private Placement represent a balanced solution taking into account the equal treatment obligations under the Norwegian Private Limited Companies Act, and the rules of equal treatment set out in the Continuing Obligations for companies admitted to trading on Euronext Growth Oslo and Oslo Børs' guidelines on the rules of equal treatment.
Advisors:
Arctic Securities AS, Clarksons Securities AS, DNB Markets, a part of DNB Bank ASA, Fearnley Securities AS and Pareto Securities AS are acting as Managers for the Private Placement.
Advokatfirmaet Schjødt AS is acting as legal advisor to the Company and Advokatfirmaet Simonsen Vogt Wiig AS is acting as legal advisors to the Managers.
This information is considered to be inside information pursuant to the EU Market Abuse Regulation and is subject to the disclosure requirements pursuant to section 5-12 the Norwegian Securities Trading Act.
This stock exchange announcement was published by Ingolf Gillesdal, VP Corporate Finance and Investor Relations Dolphin Drilling AS on 22 June 2023 at the time set out in this notice on behalf of the Company.
For further information, please contact:
Ingolf Gillesdal, email: ingolf.gillesdal@dolphindrilling.com, tel: +47 920 45 320
Dolphin Drilling | www.dolphindrilling.com
Dolphin Drilling is a leading harsh environment drilling contractor for the offshore oil and gas industry. Dolphin Drilling owns a fleet of three high-technical standard 4th and 5th generation enhanced Aker H3 units, Borgland Dolphin, Blackford Dolphin, and Bideford Dolphin, operated by an experienced team with a strong operational track record. The company has offshore and onshore offices and operations in Norway, Scotland, Brazil, and Nigeria.
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Important information:
This announcement is not and does not form a part of any offer to sell, or a solicitation of an offer to purchase, any securities of the Company. Copies of this announcement are not being made and may not be distributed or sent into any jurisdiction in which such distribution would be unlawful or would require registration or other measures.
The securities referred to in this announcement have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and accordingly may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and in accordance with applicable U.S. state securities laws. The Company does not intend to register any part of the offering in the United States or to conduct a public offering of securities in the United States. Any sale in the United States of the securities mentioned in this announcement will be made solely to “qualified institutional buyers” as defined in Rule 144A under the Securities Act.
In any EEA Member State, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Regulation, i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State. The “Prospectus Regulation” means Regulation (EU) 2017/1129, as amended (together with any applicable implementing measures) in any Member State.
This communication is only being distributed to and is only directed at persons in the United Kingdom that are (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Order”) or (ii) high net worth entities, and other persons to whom this announcement may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”). This communication must not be acted on or relied on by persons who are not relevant persons. Any investment or investments activity to which this communication relates is available only for relevant persons and will be engaged in only with relevant persons. Persons distributing this communication must satisfy themselves that it is lawful to do so.
The issue, subscription or purchase of shares or other financial instruments in the Company is subject to specific legal or regulatory restrictions in certain jurisdictions. Neither the Company nor the Managers assume any responsibility in the event there is a violation by any person of such restrictions. The distribution of this release may in certain jurisdictions be restricted by law. Persons into whose possession this release comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.
Matters discussed in this announcement may constitute forward-looking statements. Forward-looking statements are statements that are not historical facts and may be identified by words such as “believe”, “expect”, “anticipate”, “strategy”, “intends”, “estimate”, “will”, “may”, “continue”, “should” and similar expressions. Any forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Such assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. The Company does not make any guarantee that the assumptions underlying any forward-looking statements in this announcement are free from errors nor does it accept any responsibility for the future accuracy of the opinions expressed in this announcement or any obligation to update or revise the statements in this announcement to reflect subsequent events. You should not place undue reliance on any forward-looking statements in this announcement. The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice. The Company does not undertake any obligation to review, update, confirm, or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this announcement.
This announcement is made by and, and is the responsibility of, the Company. The Managers are acting exclusively for the Company and no one else and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients, or for advice in relation to the contents of this announcement or any of the matters referred to herein. Neither the Managers nor any of their respective affiliates makes any representation as to the accuracy or completeness of this announcement and none of them accepts any responsibility for the contents of this announcement or any matters referred to herein.
This announcement is for information purposes only and is not to be relied upon in substitution for the exercise of independent judgment. It is not intended as investment advice and under no circumstances is it to be used or considered as an offer to sell, or a solicitation of an offer to buy any securities or a recommendation to buy or sell any securities of the Company. The distribution of this announcement and other information may be restricted by law in certain jurisdictions. Persons into whose possession this announcement or such other information should come are required to inform themselves about and to observe any such restrictions. This announcement is an advertisement and is not a prospectus for the purposes of the Prospectus Regulation as implemented in any Member State.