PA Resources informs about publication of prospectus
The Board of Directors of PA Resources AB (publ) has prepared a prospectus on the Offer to set off the Company's convertible bonds 2008/2014 against newly issued Class B shares, which was announced on 7 November 2012. The prospectus is expected to be approved and registered today with the Financial Supervisory Authority, after which it will be published by the Company. The acceptance period will run during the period 6–17 December 2012. The Offer is subject to approval by the extraordinary general meeting on 7 December 2012.
After its publication, the prospectus will be available at www.paresources.se and www.carnegie.se, as well as on the Financial Supervisory Authority's website: www.fi.se. Certain, previously undisclosed information that is provided in the prospectus is described in the two sections below.
Strengthened financial position and strategic focus after proposed transactions
PA Resources' financial position will be significantly strengthened through the transactions (the Offer to the convertible bondholders and the rights issue of approximately SEK 700 million, which the Board of Directors, subject to certain conditions, intends to decide on after the anticipated authorisation by the extraordinary general meeting on 7 December 2012). In addition, in order to decrease future investments and the Company’s risk exposure to individual projects, going forward the Company will work actively to reduce its interests in several prioritised assets. Cash flow from producing fields, in combination with the proceeds from the rights issue, will enable continued maintenance investments in producing fields. At the same time, PA Resources believes that, through the continued use of alternative forms of financing and a level of net indebtedness that is in line with the level following the transactions, the Company will be able to continue the development of prioritised assets. The plan is to develop 30 million barrels of reserves for production. The Company believes that even after the transactions, the Company's balance sheet will be sufficiently strong – in combination with debt financing – to support planned amortisations of outstanding bond loans and credit facilities in 2013.
In the event the Offer to the convertible bondholders is not carried out, it is anticipated that a shortfall of SEK 100 million will arise in the Company's working capital in January 2013, when the coupon interest of SEK 108 million on outstanding convertible bonds falls due for payment.
Review report in connection with prospectus:
In connection with the preparation of the prospectus during the fourth quarter, the Company's auditor, Ernst & Young, submitted a review report for the Group's and Parent Company's interim report for the nine months ended 30 September 2012. Consolidated profit for the third quarter included, among other things, impairment of assets in the Republic of Congo following the Group's impairment testing, which was conducted earlier than originally scheduled. In the review report, the auditors state their conclusion that, in the third quarter, the Parent Company should also have written down an intra-Group receivable that the Parent Company has from the Group company in the Republic of Congo. At the time of publication of the third quarter interim report, the analysis of the Parent Company's need to recognise impairment for intra-Group receivables had not been completed; this work has continued during the start of the fourth quarter.
Impairment of intra-Group receivables will be reported in the Parent Company's profit for the fourth quarter and will amount to SEK 1,700–1,800 million. Had this impairment been recognised during the third quarter, the Parent Company's equity as per 30 September 2012 would have amounted to SEK 2,021–2,121 million. This impairment charge will not have any impact on the Group's profit and financial position during the fourth quarter. The auditors' review of the Group's information for the nine-month period ended 30 September 2012 has been submitted without remarks.
Stockholm, 5 December, 2012
PA Resources AB (publ)
For additional information, please contact:
Nicolas Adlercreutz, CFO, +46 70 587 44 88
PA Resources AB is an international oil and gas group which conducts exploration, development and production of oil and gas assets. The Group operates in Tunisia, Republic of Congo (Brazzaville), Equatorial Guinea, United Kingdom, Denmark, Greenland, Netherlands and Germany. PA Resources is producing oil in West Africa and North Africa. The parent company is located in Stockholm, Sweden. PA Resources’ net sales amounted to SEK 2,154 million during 2011. The company is listed on the NASDAQ OMX in Stockholm, Sweden (segment Mid Cap). For additional information, please visit www.paresources.se.
The above information has been made public in accordance with the Securities Market Act and/or the Financial Instruments Trading Act. The information was published at 09.30 AM CET on 5 December, 2012.
IMPORTANT NOTICE
The information in this press release is not for release, publication or distribution, directly or indirectly, in or into the United States, Australia, Hong Kong, Japan, Canada, Switzerland, Singapore, South Africa or New Zeeland. The distribution of this press release in certain other jurisdictions may be restricted. The information in this press release shall not constitute an offer to sell or the solicitation of an offer to purchase any securities in PA Resources in any jurisdiction. This press release does not constitute, or form part of, an offer or solicitation to purchase or subscribe for securities in the United States. The securities referred to herein may not be offered or sold in the United States absent registration or an exemption from registration as provided in the U.S. Securities Act of 1933, as amended. PA Resources does not intend to register any portion of the offering of the securities in the United States or to conduct a public offering of the securities in the United States. Copies of this announcement are not being distributed or sent and may not be distributed or sent to the United States, Australia, Hong Kong, Japan, Canada, Switzerland, Singapore, South Africa or New Zeeland.
This document has not been approved by any regulatory authority. This document is a press release and not a prospectus and investors should not subscribe for, or purchase any securities referred to in this document, except on the basis of information that will be provided in the prospectus to be published by PA Resources on its website in due course.
EUROPEAN ECONOMIC AREA
PA Resources has not resolved to offer to the public securities in any Member State of the European Economic Area other than Sweden and any other jurisdiction into which the offering of securities may be passported. Within such Member States of the European Economic Area other than Sweden (and any other jurisdiction into which the offering of securities may be passported) and which has implemented the Prospectus Directive (each, a “Relevant Member State”), no action has been undertaken as of this date to make an offer to the public of securities requiring a publication of a prospectus in any Relevant Member State. As a result hereof, the securities may only be offered in Relevant Member States: (a) to a qualified investor (as defined in the Prospectus Directive); (b) to any legal entity meeting two or more of the following criteria: (1) a balance sheet total pursuant to the balance sheet equivalent to not less than EUR 20 million; (2) net turnover pursuant to the balance sheet equivalent to not less than EUR 40 million; and shareholders’ equity pursuant to the balance sheet equivalent to not less than EUR 2 million; or (c) in any other circumstances, not requiring PA Resources to publish a prospectus as provided under Article 3(2) of the Prospectus Directive.
For the purposes hereof, the expression an “offer to the public of securities” in any Relevant Member State means the communication, in any form, of sufficient information on the terms of the offer and the securities to be offered so as to enable an investor to decide to purchase any securities, as the same may be varied in a Relevant Member State due to the implementation of the Prospectus Directive in that Member State and the expression “Prospectus Directive” means Directive 2003/71/EC including any relevant implementing measure in each Relevant Member State.
Carnegie is acting for PA Resources and no one else in connection with the offer and will not be responsible to anyone other than PA Resources for providing the protections afforded to its clients or for providing advice in relation to the offer and/or any other matter referred to in this announcement.
Carnegie accepts no responsibility whatsoever and makes no representation or warranty, express or implied, for the contents of this announcement, including its accuracy, completeness or verification or for any other statement made or purported to be made by Carnegie, or on its behalf, in connection with PA Resources and the securities or the offer and nothing in this announcement is, or shall be relied upon as, a promise or representation in this respect, whether as to the past or future. Carnegie accordingly disclaims to the fullest extent permitted by law all responsibility and liability whether relating to damages, contract or otherwise which it might otherwise have in respect of this announcement or any such statement.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements that reflect management’s current views with respect to future events and potential financial performance. Although PA Resources believes that the expectations reflected in such statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Accordingly, results can differ materially from those set out in the forward-looking statements as a result of various factors. You are advised to read this announcement, and the prospectus and the information incorporated by reference therein once available, in their entirety for a further discussion of the factors that could affect the PA Resources’ future performance and the industries in which the Company operates. In light of these risks, uncertainties and assumptions, it is possible that the events described in the forward-looking statements in this announcement may not occur.
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