TIDMAFR
RNS Number : 7539Q
Afren PLC
19 June 2015
THIS ANNOUNCEMENT IS NOT FOR RELEASE, DISTRIBUTION OR
PUBLICATION IN WHOLE OR IN PART IN OR INTO THE UNITED STATES,
AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER
JURISDICTION WHERE IT IS UNLAWFUL TO DISTRIBUTE THIS
ANNOUNCEMENT.
THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND NOT A PROSPECTUS AND
INVESTORS MUST ONLY SUBSCRIBE FOR OR PURCHASE ANY SECURITIES
REFERRED TO IN THIS ANNOUNCEMENT ON THE BASIS OF THE INFORMATION
CONTAINED IN A PROSPECTUS AND NOT IN RELIANCE ON ANY INFORMATION IN
THIS ANNOUNCEMENT.
Launch of the Proposed Debt Restructuring and Refinancing
London, 19 June 2015
Afren plc ("Afren", the "Company" or the "Group"), (LSE: AFR)
today announces the publication of a prospectus and circular to
shareholders relating to its proposed Restructuring, including the
Open Offer to shareholders, the receipt of an additional US$148
million in net cash proceeds and the proposed restructuring of the
Company's outstanding Notes. The Directors believe that the
Restructuring is in the best interests of the Company and for the
benefit of all stakeholders.
Commenting today, Egbert Imomoh, Chairman of Afren plc,
said:
"Afren Shareholders have been through an incredibly difficult
period in the life of the business, and the next steps, whilst
complex, are essential if we want to successfully emerge from this
period on a value growth trajectory. I am clear that the only
viable course of action for the business is to progress through the
proposed refinancing process; it offers the only secure route to
relieve the unsustainable debt burden, and support Afren's
recovery. "
Commenting today, Alan Linn, CEO of Afren plc, said:
"I believe Afren has significant potential within its core
Nigerian portfolio which will enable us to successfully emerge from
this period and provide growth to all shareholders. The recommended
restructuring, combined with the open offer, is the only viable
opportunity for our shareholders to realise any value from their
investment in the company. I urge all Afren shareholders to
recognise this fact and vote to retain their active interest in the
company by voting in favour of the proposed debt restructuring and
refinancing."
SHAREHOLDERS SHOULD VOTE IN FAVOUR OF THE RESTRUCTURING
In the opinion of the Directors, voting for the Resolution and
authorising the implementation of the Restructuring will:
-- Provide Existing Shareholders the only opportunity to realise
value and participate in the recovery of the Group
-- Provide Existing Shareholders an opportunity to participate
in the Open Offer to increase their ownership position on
favourable terms
-- Improve the capital structure of the Group to provide it the
time to implement its business plan and grow the value of its
assets
-- Prevent a formal insolvency filing
If Shareholders do not approve the Resolution at the General
Meeting, Existing Shareholders have no prospect of any value. Upon
a No vote:
-- The restructuring will still proceed without delay
-- The amount of debt will increase by approximately US$266
million immediately as compared to a Yes vote and the interest
rates on the Group's new debt will cause outstanding debt to
increase significantly. There is no value for shareholders unless
and until all of this debt is repaid
-- Holders of the New Senior Notes will have security over all
of the Group's operating subsidiaries
-- The Company will be required to have entered into an
agreement by no later than 31 December 2016 to sell all of its
assets. These assets can be sold to any party, including the
Noteholders, and can be completed with or without shareholder
approval.
The Directors consider that if Shareholders do not approve the
Resolution at the General Meeting, the Shareholders would be
unlikely to receive any proceeds from the sale of the Group or the
required disposal of the Group's assets or other return of income
or capital by the Company, and therefore the Shareholders would be
unlikely to see any return of their current investment.
In the Board's opinion, the Restructuring, including the Open
Offer is in the best interests of Afren and the Shareholders taken
as a whole. Accordingly, the Afren Board unanimously and strongly
recommends Shareholders to vote in favour of the Resolution to be
proposed at the General Meeting, as all Directors have irrevocably
undertaken to do in respect of their own beneficial holdings of
Existing Shares, amounting to 6,640,839 Existing Shares and 0.6% of
the total number of votes available to be cast at the General
Meeting.
Terms of the Restructuring
The principal components of the Restructuring comprise:
-- the implementation of a scheme of arrangement in respect of
the Existing Notes, including:
o the issue of approximately US$369 million of new high yield
notes due 2017 to refinance and repay the Bridge Securities and to
provide an additional US$148 million in net cash proceeds to the
Group;
o the conversion of approximately US$234 million of the Existing
Notes (representing 25% of the 2016 Notes, the 2019 Notes and the
2020 Notes) into new Ordinary Shares in the Company, representing
80% of the existing issued share capital; and
o the remainder of the Existing Notes to be cancelled and
reissued in equal amounts of approximately US$350 million each of
new notes due December 2019 and December 2020 respectively, with an
annual interest rate of 9.1%;
-- the issue of additional new Ordinary Shares, equal to 50% of
the issued share capital of the Company following the Debt for
Equity Swap described above, to holders of the New Senior
Notes;
-- the issue of up to GBP49.2 million (approximately US$75
million) of new Ordinary Shares by way of an open offer to
Shareholders at 1 pence per Open Offer Share;
-- the issue of new Ordinary Shares, equal to 10% of the fully
diluted share capital of the Company following the completion of
the Open Offer, to holders of the New Senior Notes in order of
priority of their agreement to subscribe for the New Senior
Notes;
-- the issue of new Ordinary Shares, equal to 5% of the fully
diluted share capital of the Company following the completion of
the Open Offer, to the holders of the Bridge Securities in partial
repayment of the Bridge Securities;
-- the entry into an amended term facility with the Ebok
Lenders, including to extend the period for repayment of the US$300
million Ebok Facility until June 2019; and
-- the entry into an amended loan agreement with the Okwok/OML
113 Lender, including to extend the period for repayment of the
US$50 million Okwok/OML 113 Facility until June 2019.
These summary highlights should be read in conjunction with the
further details of the Restructuring, which are set out below.
The Restructuring will be implemented by means of a scheme of
arrangement of the Existing Notes under the Companies Act 2006. The
terms of the Restructuring, but not its implementation, are also
subject to the approval of Shareholders in general meeting.
Information on the proposed refinancing is available at
www.afrenegmvote.com
For further information contact:
Afren plc Tel: +44 20 7864 3700
Alan Linn, Chief Executive
Officer
Natalia Erikssen, Investor
Relations
Bell Pottinger (public Tel: +44 20 7772 2500
relations adviser to Afren
plc)
Gavin Davis
Henry Lerwill
Highlights of the Restructuring
The Restructuring will provide holders of the Existing Shares
with the opportunity to participate further in any potential upside
arising from any increase in oil prices and the Group's exploration
and appraisal portfolio.
The principal components of the Restructuring comprise the
following:
-- The issue of the New Senior Notes, the Debt for Equity Swap,
the New Senior Notes Share Issue and the issue of the New 2019 and
New 2020 Notes will be made by way of a scheme of arrangement
between the Group and the Existing Noteholders in accordance with
Part 26 of the Companies Act (the "Scheme").
-- As part of the Scheme, Afren Finance plc (a newly
incorporated direct subsidiary of the Company (the "Notes Issuer"))
will issue approximately US$369 million of new high yield notes due
August 2017 ("New Senior Notes") to refinance and repay
substantially all of the Bridge Securities and provide an
additional US$148 million in net cash proceeds to the Group. The
issue of the New Senior Notes has been fully subscribed by the
Bridge Noteholders, while all Existing Noteholders will be eligible
to participate in the subscription for the New Senior Notes pro
rata to their existing holdings (by way of claw back of the initial
subscription by the Bridge Noteholders). The New Senior Notes will
carry an annual interest rate of 15% (7.5% payable in cash and 7.5%
payable in kind).
-- As part of the Scheme, 25% of the face value of the
outstanding principal amount (and accrued interest) of the Existing
Notes (being approximately US$234 million) will be released and
converted into equity pursuant to the issue of new Ordinary Shares
to Existing Noteholders, which will result in Existing Noteholders
holding 80% of the increased share capital of the Company
immediately following such conversion (the "Debt for Equity
Swap").
-- As part of the Scheme, the remainder of the Existing Notes
will be cancelled and reissued into two equal amounts of
approximately US$350 million of new notes due 2019 and 2020
respectively to be issued by the Notes Issuer (the "New 2019 Notes"
and the "New 2020 Notes", respectively). The New 2019 Notes and the
New 2020 Notes will have an annual interest rate of 9.1%, payable
in kind until the New Senior Notes are fully repaid and then
payable in cash.
-- As part of the Scheme, immediately following the
implementation of the Scheme, the Company shall issue new Ordinary
Shares for cash at nominal value to those Existing Noteholders who
subscribe for New Senior Notes. The Company has agreed to issue a
total aggregate amount of new Ordinary Shares representing 50% of
the fully diluted share capital of the Company following the
completion of the Debt for Equity Swap (the "New Senior Notes Share
Issue").
-- The Company will subsequently commence a pre-emptive open
offer (the "Open Offer") to all Shareholders, including those
Existing Noteholders who acquire shares pursuant to the Debt for
Equity Swap and the New Senior Notes Share Issue. The Open Offer
will comprise up to GBP49.2 million in new Ordinary Shares offered
on the basis of 4 new ordinary shares for each 9 ordinary shares
held on the relevant record date. Shareholders will have the
ability to subscribe for more than their pro rata interest pursuant
to an excess application facility, however applications from
Existing Shareholders for additional shares will be limited so that
Existing Shareholders will be limited in aggregate to a maximum
holding of 15% of the issued share capital immediately following
the completion of the Restructuring.
-- Upon completion of the Open Offer, as part of the Scheme the
Company has agreed to issue for cash at nominal value to certain of
the Existing Noteholders who subscribed for New Senior Notes
additional new Ordinary Shares representing 10% of the fully
diluted share capital of the Company following the completion of
the Debt for Equity Swap, the New Senior Notes Share Issue, the
Open Offer and the Bridge Securities Share Issue (the "Early
Subscriber Issue"). Such additional Ordinary Shares will be
allocated to Noteholders who subscribed for New Senior Notes, as an
"early bird" incentive payment, in the order of priority of their
agreement to subscribe for New Senior Notes.
-- If the New Senior Notes are issued after 7 August 2015, the
amount of the Early Subscriber Issue will increase by 0.1205% of
the fully diluted share capital of the Company for each day from 8
August 2015 until the date of issue of the New Senior Notes (the
"Additional Commitment Issue"). This is intended as a form of
commitment fee for Existing Noteholders agreeing to subscribe early
to the issue of the New Senior Notes.
-- US$5 million of the Bridge Securities will not be repaid by
the New Senior Notes, but will instead be released and converted
into equity pursuant to the issue of new Ordinary Shares to Bridge
Noteholders (or their nominees), in an aggregate amount
representing 5% of the fully diluted share capital of the Company
following the completion of the Debt for Equity Swap, the New
Senior Notes Share Issue, the Open Offer and the Early Subscriber
Issue (the "Bridge Securities Share Issue").
-- Afren will enter into an amendment agreement with the Ebok
Lenders in respect of the Ebok Facility (the "Amended Ebok
Facility"), pursuant to which, amongst other things, the period for
repayment of the US$300 million Ebok Facility will be extended
until 30 June 2019. These amendments will come into effect only if
the Restructuring is completed.
-- Afren has entered into an amendment agreement with Access
Bank in respect of the Okwok/OML 113 Facility (the "Amended
Okwok/OML 113 Facility"), pursuant to which the period for
repayment of the US$50 million Okwok/OML 113 Facility will be
extended until June 2018.
-- Afren will enter into a global intercreditor agreement (the
"Global Intercreditor Agreement") which will replace certain
existing intercreditor agreements and pursuant to which, amongst
other things, with respect to the Ebok Collateral, the New Senior
Notes will rank ahead of the Amended Ebok Facility and the Amended
Ebok Facility will rank ahead of the Existing Notes. The Global
Intercreditor Agreement will come into effect only if the
Restructuring is completed.
-- Prior to the implementation of the Scheme, the Group will
undertake an internal reorganisation and the Notes Issuer will
become an intermediate holding company of the Group. The Notes
Issuer (together with an affiliate of the Notes Issuer) will
subsequently hold all of the Company's investments in its operating
subsidiaries and will also acquire all (or substantially all) of
the Company's assets (the "Security Reorganisation"). The Company
has also agreed to grant security over its interests in the Notes
Issuer's shares in favour of the New Senior Notes Trustee (for the
benefit of, among others, the holders of the New Senior Notes).
Details of the Open Offer
The Company proposes to raise up to GBP49.2 million
(approximately US$75 million) by way of Open Offer subject to,
inter alia, the passing by Shareholders of the Resolution at the
General Meeting, by the issue of up to 4,922,491,218 new Ordinary
Shares. The Offer Price of 1 pence per Ordinary Share, which is
payable in full on acceptance, represents a 46.5% discount to the
closing middle market price of an Existing Share on 18 June 2015
(being the last business day before the announcement by Afren of
the terms of the Open Offer) and a 26.3% discount to the
theoretical ex-right price of an Existing Share based on that
closing price.
The Open Offer is open to all Shareholders, including those
Existing Noteholders who acquire Ordinary Shares pursuant to the
Debt for Equity Swap and the New Senior Notes Share Issue.
Under the Open Offer, Qualifying Shareholders may apply for Open
Offer Shares at the Offer Price, payable in full on application,
free of all expenses, up to a maximum of their pro-rata
entitlement, which shall be calculated on the basis of:
4 Open Offer Shares for every 9 Existing Shares
held by them and registered in their names at 5.00 p.m. on the
Record Date and so in proportion for any other number of Existing
Shares then heldand otherwise on the terms and conditions set out
in the Prospectus and, in the case of Qualifying non-CREST
Shareholders, the Application Form.
Holdings of Existing Shares in certificated and uncertificated
form will be treated as separate holdings for the purpose of
calculating entitlements under the Open Offer. Fractional
entitlements to Ordinary Shares will not be allotted to Qualifying
Shareholders and, where necessary, entitlements will be rounded
down to the nearest whole number of Ordinary Shares. Ordinary
Shares representing fractional entitlements will not be allotted to
Qualifying Shareholders but will be aggregated. Accordingly,
Qualifying Shareholders with fewer than three Existing Shares will
not be entitled to any Open Offer Shares.
The Open Offer will include an excess application facility,
which will allow Qualifying Shareholders to subscribe for
additional Open Offer Shares. The maximum number of Shares
available under the excess application facility will be up to the
full number of Open Offer Shares, but applications from Existing
Shareholders will be limited to so that the maximum number of Open
Offer Shares issued in total under the Open Offer to Existing
Shareholders is capped at 984,498,244 Open Offer Shares. This is to
ensure that Existing Shareholders will hold up to a maximum of 15%
of the total issued share capital of the Company following the
Restructuring. If applications for additional Open Offer Shares
under the excess application facility exceed the aggregate number
of Excess Application Shares, subscriptions will be scaled back at
the discretion of the Company, such that the Company intends to
allocate on a priority basis applications received from
Shareholders who hold shares prior to the implementation of the
Scheme.
The Ordinary Shares will, when issued and fully paid, rank pari
passu in all respects with the Existing Shares, including the right
to all future dividends and other distributions declared, made or
paid.
The Open Offer is conditional, amongst other things, upon:
(a) the passing of the Resolution (without amendment) at the General Meeting;
(b) the Scheme having become effective in accordance with its terms; and
(c) Admission becoming effective by not later than 8.00 a.m. on
24 August 2015 (or such later time and/or date as Afren and the
sponsor may agree, being not later than 8.00 a.m. on 7 September
2015).
Applications will be made to the FCA for the new Open Offer
Shares to be admitted to the premium listing segment of the
Official List and to the London Stock Exchange for the new Open
Offer Shares to be admitted to trading on the main market for
listed securities. It is expected that Admission will become
effective and dealings (for normal settlement) in the Open Offer
Shares will commence at 8.00 a.m. on 24 August 2015.
The Open Offer is not underwritten.
Conditionality of the Restructuring
The implementation of the Restructuring is conditional upon,
inter alia, approval of a special resolution to be put to
Shareholders in general meeting (which is necessary to approve the
allotment and issue of the Open Offer and the issue of shares in
connection with the Restructuring). If Shareholders do not vote in
favour of the Resolution, but the other conditions to the
implementation of the Restructuring are satisfied or waived, the
Restructuring will still be implemented, but on adjusted terms (the
"Alternative Restructuring").
In addition to obtaining Shareholder approval for the passing of
the Resolution, the Restructuring will require the Amended Ebok
Facility and the Amended Okwok/OML 113 Facility to have been
executed, as well as the completion of the Security Reorganisation.
The Scheme will require the consent of not less 75% of holders (by
value) and a majority in number of the 2016 Notes, 2019 Notes and
2020 Notes that attend and vote at the Scheme meeting. The Scheme
will also require the sanction of the English High Court and
approval by the Delaware court of a Chapter 15 reconstruction.
Currently, holders of Existing Notes representing approximately
54.6% in aggregate of the 2016 Notes, the 2019 Notes and the 2020
Notes have contractually undertaken to vote in favour of the
relevant resolutions at the Scheme meeting.
Even if Shareholders approve the Resolution, if the remaining
conditions to the Restructuring are not satisfied (or where
possible waived) no form of restructuring will be implemented. In
such circumstances, the Directors believe that the Group would face
an immediate risk of being unable to meet its contractual
obligations when they fall due. This is because the Directors
believe that the Group's lenders would be highly likely to
accelerate the Group's borrowings given the existing events of
default under the Group's facilities and other borrowings and the
failure of the Group to complete a consensual restructuring. As a
result the Company would cease trading and the subsidiaries of the
Company would become subject to applicable insolvency processes and
the Directors believe that there would be no prospect that
Shareholders would receive any proceeds from the sale of the
Group's assets or other return of income or capital by the
Company.
Importance of the vote and consequences of a failure to approve
the Restructuring
If Shareholders do not approve the Resolution at the General
Meeting, but the other conditions to the Restructuring are
satisfied (including the approval of the Scheme by the Existing
Noteholders at the Scheme Meeting), the Restructuring will still be
implemented, but on the terms of the Alternative Restructuring.
Shareholders should therefore be aware that they cannot prevent
the implementation of the Restructuring by voting "no" at the
General Meeting.
If the Alternative Restructuring is implemented, the Directors
believe that there would be no prospect that Shareholders would
receive any proceeds from the sale of the Group or the disposal of
the Group's assets or other return of income or capital by the
Company.
Following a No vote, under the Alternative Restructuring:
-- The cost and amount of the Group's debt will increase significantly
Total debt of US$1,525 million will rank ahead of shareholders
in right of payment.
As compared to the terms of the Restructuring, the amount owing
to holders of the New Senior Notes will increase by US$266 million
immediately and by a further US$371 million over the next two years
due to higher interest payable on such notes.
-- The holders of the New Senior Notes will have security over
all of Afren's operating subsidiaries
The holders of the New Senior Notes will have share pledge
security over the Notes Issuer and the operating subsidiaries. This
security was granted as a condition of the new funding; without
this, the Company would not have received the proceeds of the
Bridge Securities or the additional funding under the New Senior
Notes and it would have been very unlikely to have avoided
insolvency proceedings.
An internal reorganisation is being undertaken with the
insertion of a new intermediate holding company (Afren Finance plc,
being the issuer of the New Senior Notes, New 2019 Notes, New 2020
Notes and New 2021 Notes), which will result in the Company no
longer directly holding shares in its operating subsidiaries.
Afren's only material asset will be its investment in the Notes
Issuer and Afren International Limited (another holding company for
the Nigerian operating subsidiaries).
-- The Company will be required to have entered into an
agreement by no later than 31 December 2016 to sell all of its
assets
In order to avoiding triggering an event of default, the Company
will need to complete certain actions as part of this sale process
by 31 December 2015 and enter into binding agreements for such sale
by 31 December 2016.
There will therefore be a limited time for shareholders to
recover value as the sale proceeds will need to be in excess of the
amount of the Group's debt.
-- Holders of the New Senior Notes will have effective control
over the sale of the Group's assets
The holders of the New Senior Notes will be entitled to appoint
a majority of the board of Directors and therefore they will have
effective control of the sale process. The Group's assets may be
sold to any party, including the Noteholders.
Shareholders will only receive value if any sales proceeds of
the Group's assets are in excess of the amount of the debt.
-- Holders of the New Senior Notes will be able to enforce their
security on any default without requiring shareholder approval
Importantly, while any sale will be subject to Shareholder
approval as required by the Listing Rules, it is an event of
default under the New Senior Notes if shareholders do not approve a
sale when required.
Accordingly, upon any event of default, including due to failure
of shareholders to approve the sale, the holders of the New Senior
Notes will be able to enforce their security without further
shareholder approval.
Details of the amendments to the terms of the Restructuring that
will be implemented under the Alternative Restructuring are set out
in Appendix I to this announcement.
If Shareholders do not approve the Resolution at the General
Meeting, including granting authority for the issue of new Ordinary
Shares in connection with the Restructuring, the economic terms of
the Alternative Restructuring (being the terms of the Alternative
New Senior Notes, the obligation to pay US$934 million in principal
(and interest) under the New 2019 Notes, the New 2020 Notes and the
New 2021 Notes), together with the requirement to initiate a sale
of the Group's business, will mean that the Shareholders would be
unlikely to receive any proceeds from the sale of the Group or the
required disposal of the Group's assets or other return of income
or capital by the Company, and therefore the Shareholders would be
unlikely to see any return of their current investment.
Dilution
The Restructuring will result in substantial dilution for
Existing Shareholders in their interests in the Company. Following
the implementation of the Restructuring (and assuming that the Open
Offer is subscribed in full by all qualifying shareholders), the
Existing Shareholders, in aggregate, will own up to approximately
9% of the share capital in the Company, and the holders of the
Existing Notes, in aggregate, will own approximately 91% of the
share capital in the Company.
This level assumes that the holders of the Ordinary Shares
issued pursuant to the Debt for Equity Swap shares and the New
Senior Notes Share Issue take up their Open Offer Entitlements in
full. However, the members of the Ad Hoc Committee have indicated
that they do not intend to participate in the Open Offer, which
would allow their basic entitlements to be available to satisfy
applications under the excess application facility and reduce this
level of dilution.
If only Existing Shareholders subscribe under the Open Offer,
including taking up in full their entitlements under the excess
application facility, Existing Shareholders will now be able to
hold up to 15% of the share capital in the Company following the
completion of the Restructuring. This shareholding level for
Existing Shareholders has been increased from 11% as announced on
13 March 2015 when the Restructuring was initially agreed in
principle.
The following table shows the dilution to the issued share
capital for each stage of the Restructuring and the cumulative
dilution effect for Existing Shareholders.
Dilution to
issued share Cumulative Interests
Step capital of Existing Shareholders
Current position - 100%
Debt for Equity Swap 80% 20%
New Senior Notes
Share Issue 50% 10%
Open Offer - 17%(1)
Bridge Securities
Share Issue 5% 16% (1)
Early Subscriber
Issue 10% 15% (1)(2)
Completion of Restructuring - 15% (1)(2)
(1) Assumes that Existing Shareholders subscribe for their Open
Offer Entitlements in full and no holder of Existing Notes
subscribes for any Open Offer Shares.
(2) Assumes that the New Senior Notes are issued on or before 7
August 2015 so that the Additional Commitment Issue does not become
payable.
Additionally, if the New Senior Notes are issued after 7 August
2015, the Additional Commitment Issue will become payable and the
amount of the Early Subscriber Issue will increase by 0.1205% of
the fully diluted share capital of the Company for each day from 8
August 2015 until the date of issue of the New Senior Notes. It
should be noted that this deadline has been extended from the
original date of 22 July 2015 announced in March 2015. If the
Restructuring proceeds on the timetable outlined in the Prospectus,
this Additional Commitment Issue would not become payable.
The total number of Ordinary Shares in issue immediately prior
to the Restructuring will represent between approximately 6% and 9%
of the total number of Ordinary Shares in issue immediately
following completion of the Restructuring (depending upon the level
of take up in the Open Offer). The new equity being injected will
therefore be represented by between approximately 91% and 94% of
the total number of Ordinary Shares in issue immediately following
completion of the Restructuring, but before the implementation of
the share consolidation.
If the Shareholders decide to not take up some or all of their
Open Offer Entitlements, the proportion of Afren they will own will
be significantly smaller once the Restructuring has been completed,
as Ordinary Shares are being issued for the purposes of the
Restructuring. In these circumstances the Shareholders' interest in
Afren will be diluted further and the maximum dilution they would
suffer immediately following completion of the Restructuring in the
event that they do not take up any of their Open Offer Entitlements
would be 94%.
Financial Effects of the Restructuring
The Directors cannot give any assurance (even if the
Restructuring is successfully completed) that the Group's business
will be successful in the future. Even if the Restructuring does
proceed, the ability of the Group to be in a position to return
value to Shareholders (either through an increased share price or
payment of dividends or a return of capital in the longer term) for
their investment is highly dependent on the ability of the Group to
restructure its operations in order to reduce its cost base,
through headcount reductions, renegotiating pricing and terms with
suppliers to reflect the current lower oil price environment, and
also developing and monetising its reserves. The Group anticipates
that its operating expenses will benefit from a targeted 15% in
efficiency savings through a reduction in market rates and
renegotiating contracts with suppliers. The Group will also need to
successfully drive operational improvements, in particular
improving recovery rates and increasing production.
The Group will be dependent on the prevailing market oil price,
even though the cost reductions and operational improvements
described above should allow the business to be more sustainable in
a lower oil price environment compared to the last quarter of 2014.
The Group's aim is to ensure that its business is in a strong
position to sustain operations at current oil price levels,
although it will take time to implement the operational
restructuring and see the benefits of such changes. If oil price
levels return to or even fall below levels seen in early 2015, the
Company will need to review ongoing capital expenditures and
operational costs. Additionally, while the Group's 2015 Business
Plan focuses on capital investment in producing assets, all
discretionary spending on exploration projects has been put on hold
beyond 2015.
If the crude oil price remains at or near its current level,
production remains static or decreases, cost reductions and
operational improvements are not successfully implemented,
appraisal assets are not developed and/or if no new discoveries are
made and monetised, it is likely that no dividends would be
declared, made or paid and that Afren would be unable otherwise to
return any value to its Shareholders. The decrease in crude oil
prices in the second half of 2014 has impacted the Group's revenue,
and has and may continue to reduce the amount of cash flow
available to fund the Group's operations and certain capital
expenditure projects, which in turn would reduce production volume
and exacerbate the decrease in revenue. If prices for the Group's
crude oil fall further or remain at lower levels, this would
materially adversely affect the Group's business, results of
operations, financial condition and prospects, and the trading
price of the Ordinary Shares.
Currently, the Group's outstanding aggregate debt under such
indebtedness is approximately US$1,789 million, and interest on
such debt continues to accrue. Immediately following the completion
of the Restructuring, the Group will have aggregate borrowings from
financial institutions of approximately US$1,525 million. This will
comprise the following:
-- the Notes Issuer will have indebtedness of approximately
US$700 million pursuant to the New 2019 Notes and the New 2020
Notes;
-- the Notes Issuer will have indebtedness of approximately
US$369 million pursuant to the New Senior Notes due for repayment
by August 2017; and
-- the Group will have indebtedness of approximately US$454
million pursuant to the Amended Ebok Facility, the Amended
Okwok/OML 113 Facility and the OML 26 Facility.
The Group will also have certain other debt for borrowed money
under agreements with its bank lenders.
Use of proceeds of the Restructuring
Assuming the Open Offer is subscribed in full, the Open Offer
proceeds of GBP49.2 million (before expenses) will be applied by
Afren as follows:
-- 50% of the gross proceeds will be used to make payments for a
pro rata reduction in the principal amount outstanding under the
Ebok Facility and Okwok/OML 113 Facility; and
-- the balance of the gross proceeds for general working capital purposes.
Any repayment of existing indebtedness under the Ebok Facility
and the Okwok/OML 113 Facility out of the proceeds of the Open
Offer is in addition to, and not in replacement of, the amended
amortisation payments schedule. Only to the extent the Company
receives proceeds from the Open Offer will it be required to make
the payments under the Ebok Facility and Okwok/OML 113 Facility
described above.
However, as the Open Offer is not underwritten, there is no
assurance that the Company will receive any proceeds under the Open
Offer. The Company can implement the Restructuring (provided the
Resolution is passed) or the Alternative Restructuring (if
Resolution is not passed) and continue as a going concern even if
it does not receive any proceeds from the Open Offer.
In addition to any proceeds received under the Open Offer, the
Company expects to use the net proceeds of the issue of the New
Senior Notes (being US$148 million before expenses) for general
working capital purposes, including capital expenditure for its
core producing assets in Nigeria. The Company will also receive the
nominal value of the Ordinary Shares comprised in the New Senior
Notes Share Issue and Early Subscriber Issue, which will amount to
less than GBP1,500. The Company estimates the expenses of the
Restructuring will be approximately US$63 million, which it intends
to pay with any proceeds of the Open Offer, as well as the net
proceeds of the issue of the New Senior Notes and existing cash
balances.
The Company has approached the Ad Hoc Committee with a view to
increasing the amount borrowed under the Bridge Securities by an
additional US$30 million in net cash proceeds to provide additional
working capital. Any additional borrowing under the Bridge
Securities will be repaid out of the proceeds of the New Senior
Notes. The Ad Hoc Committee is currently considering such request
and there can be no assurance that such funding will be made
available.
Expected timetable
Afren will shortly issue a combined circular and prospectus to
Shareholders, setting out the details of the Restructuring and
convening a general meeting of the Company, which is expected to be
held at 11.00 a.m. on 24 July 2015 at the offices of White &
Case LLP, 5 Old Broad Street, London EC2N 1DW, at which the
Resolution will be put to Shareholders.
The Company is targeting the implementation of the scheme of
arrangement at the beginning of August and the completion of the
Restructuring before the end of August 2015.
Time and Date
Event 2015
-------------------------------------------- ---------------
Announcement of the Restructuring
and Open Offer 13 March
Publication of Prospectus 19 June
11.00 a.m.
Annual General Meeting on 25 June
Latest time and date for receipt
of Forms of Proxy or submission 11.00 a.m.
of proxy votes electronically on 22 July
11.00 a.m.
General Meeting on 24 July
Determination as to whether the
Restructuring or Alternative Restructuring
applies and the Open Offer will
proceed 24 July
Effective Date of the Scheme 5 August
Record Date for entitlements under 5.00 p.m.
the Open Offer on 6 August
Ex entitlement Date for the Open 8.00 a.m.
Offer on 7 August
Open Offer Entitlements and Excess
Open Offer Entitlements credited
to stock accounts in CREST of Qualifying
CREST Shareholders 10 August
Latest recommended time and date
for requesting withdrawal of Open
Offer Entitlements and Excess Open 4.30 p.m.
Offer Entitlements from CREST on 17 August
Latest recommended time and date
for depositing Open Offer Entitlements
and Excess Open Offer Entitlements 3.00 p.m.
into CREST on 18 August
Latest time and date for splitting
Application Forms (to satisfy bona 3.00 p.m.
fide market claims) on 19 August
Latest time and date for receipt
of completed Application Forms and
payment in full under the Open Offer
or settlement of relevant CREST 11.00 a.m.
instructions (as appropriate) on 21 August
Results of the Open Offer announced 7.00 a.m.
through an RIS on 24 August
Admission and commencement of dealings
in the Ordinary Shares expected 8.00 a.m.
to commence on 24 August
CREST stock accounts expected to
be credited for the Ordinary Shares 8.00 a.m.
as soon as practicable after on 24 August
Share certificates for Ordinary
Shares expected to be despatched By 7 September
Notes:
(1) Each of the times and dates in the above timetable, and
mentioned elsewhere in this document, is subject to change, in
which event details of the new times and/or dates will be notified
to the FCA and the London Stock Exchange and, where appropriate,
Qualifying Shareholders. Please note that any Existing Shares sold
prior to close of business on 7 August 2015, the last date on which
the Existing Shares trade with entitlement, will be sold to the
purchaser with the right to receive Open Offer Entitlements.
(2) All references to time in this document relate to London time.
SCHEME TIMETABLE 2015
Explanatory Statement sent to Existing
Noteholders 30 June
General Meeting to approve the Resolution 24 July
Determination as to whether the Restructuring
or Alternative Restructuring applies 24 July
Creditors' meeting to vote on the
Scheme 29 July
Sanction Hearing (UK) 30 July
Chapter 15 Hearing (US) 31 July
Issue of New Senior Notes and repayment
of Bridge Securities 5 August
Sub-Division of Ordinary Shares* 5 August
Debt for Equity Swap and New Senior
Notes Share Issue* 5 August
Date from which Additional Commitment
Issue applies* 8 August
Completion of Open Offer, Bridge Securities
Share Issue and Early Subscriber Issue* 24 August
Consolidation of Ordinary Shares* 24 August
Expected completion date of the Restructuring* 24 August
* Assuming that the Resolution is approved
Recommendation
If Shareholders do not approve the Resolution at the General
Meeting, including granting authority for the issue of new Ordinary
Shares in connection with the Restructuring, it is expected that
the economic terms of the Alternative Restructuring, together with
the requirement to initiate a sale of the Group's business, will
mean that the Shareholders would be unlikely to receive any
proceeds from the sale of the Group or the required disposal of the
Group's assets or other return of income or capital by the Company,
and therefore the Shareholders would be unlikely to see any return
of their current investment.
In the Board's opinion, the Restructuring, including the Open
Offer is in the best interests of Afren and the Shareholders taken
as a whole. Accordingly, the Afren Board unanimously recommends
Shareholders to vote in favour of the Resolution to be proposed at
the General Meeting, as all Directors have irrevocably undertaken
to do in respect of their own beneficial holdings of Existing
Shares, amounting to 6,640,839 Existing Shares and 0.6% of the
total number of votes available to be cast at the General
Meeting.
Prospectus
The Prospectus, containing full details of how Shareholders can
participate in the Open Offer, and the Notice of General Meeting
are expected to be published shortly. Copies of the Prospectus will
be available on the Company's website, www.afren.com. Copies of the
Prospectus will also be available from the registered office of the
Company at 1 Pall Mall East, London, SW1Y 5AU during usual business
hours on any weekday (not including Saturdays, Sundays or any
public holidays in the United Kingdom) from the date of its
publication until Admission.
General Meeting
The implementation of the Restructuring is conditional upon,
inter alia, the approval of the Shareholders at a general meeting
of the Company, which is expected to be held at 11.00 a.m. on 24
July 2015 at the offices of White & Case LLP, 5 Old Broad
Street, London EC2N 1DW.
APPENDIX I
Details of the Alternative Restructuring
The Alternative Restructuring
If the Alternative Restructuring is implemented, the Directors
believe that the Shareholders would be unlikely to receive any
proceeds from the sale of the Group or the disposal of the Group's
assets or other return of income or capital by the Company. The
Alternative Restructuring, if implemented, should allow the Group
to remain as a going concern to enable an orderly sale process in
accordance with the requirements of the New Senior Notes. Under the
Alternative Restructuring, the Amended Ebok Facility will still be
effective and the New Senior Notes will still be issued, but on
amended terms. No new ordinary shares will be issued in connection
with the Alternative Restructuring and the Open Offer will not be
made available to Shareholders, so the Existing Shareholders will
continue to own 100% of the Company's issued share capital and will
not suffer dilution to their shares. However, the Company will not
receive any proceeds from the Open Offer.
Furthermore, the Alternative Restructuring will include the
following amendments to the terms of the Restructuring:
-- US$5 million of the Bridge Securities will not be repaid via
the issue of new ordinary shares under the Bridge Securities Share
Issue and the Bridge Securities will become repayable in full
pursuant to the issue of the New Senior Notes;
-- the Debt for Equity Swap will not be implemented and,
instead, the US$234 million of Existing Notes which would have been
repaid under the Debt for Equity Swap will be reinstated as a new
series of notes that will become due in December 2021, with
interest at 20.2% per annum payable in kind (the "New 2021
Notes");
-- the terms of the New Senior Notes will be amended (the
"Alternative New Senior Notes") such that:
o the principal amount of the New Senior Notes will be increased
to approximately US$401 million (from US$369 million) due to (i) an
increased discount of 5% to the issue price of the New Senior
Notes, (ii) the early subscription fee being payable in cash
(rather than in Ordinary Shares pursuant to the Early Subscriber
Issue) and (iii) US$5 million of the Bridge Securities being
payable by the issue of additional New Senior Notes;
o the interest rate on the New Senior Notes will be adjusted,
with (i) interest of 7.1% per annum payable in cash on the
principal amount of the New Senior Notes, (ii) interest of 2.5% per
annum payable in kind on the principal amount of the New Senior
Notes being capitalised under a separate class of payment in kind
notes (due in August 2017) (the "New Senior PIK Notes") and (iii)
interest of 26.9% per annum payable in kind on the principal amount
of the New Senior Notes being capitalised under a separate class of
payment in kind notes (due no earlier than six months after the
maturity date of the Amended Ebok Facility) (the "New Junior PIK
Notes");
-- no new Ordinary Shares will be issued, either under the terms
of the Bridge Securities, the New Senior Notes or pursuant to any
equity offering to existing Shareholders;
-- the holders of the Alternative New Senior Notes will also
have the right to appoint a majority of the Company's Board and the
board of directors of the Notes Issuer and Afren International
Limited, with control over the process for the sale of the Group's
business, under the terms of an investor rights agreement (the
"Investor Rights Agreement"); and
-- it will be an event of default under the Alternative New Senior Notes if:
o the Company does not take certain steps to initiate a sale of
all or substantially all of the Group's business by the end of
2015; and/or
o the Company has not entered into an agreement or agreements
(each a "sale agreement") for the sale of all or substantially all
of the Group's business by the end of 2016; and/or
o Shareholders do not approve the terms of any sale agreement
when put to them for approval; and/or
o any binding sale agreement is terminated as a result of a
failure to satisfy conditions of such agreement (other than
shareholder approval), provided that such termination shall not in
any event be an event of default before 31 March 2017; and/or
o the Company, the Notes Investor or Afren International Limited
breaches the terms of the Investor Rights Agreement.
Any sale or disposal of the business or assets of the Group
pursuant to the Alternative Restructuring will be subject to the
provisions of the Listing Rules on substantial transactions and may
require shareholder approval as appropriate.
If Shareholders fail to approve the sale of such assets (by way
of a simple majority of Shareholders attending and voting in
general meeting), holders of the Alternative New Senior Notes will
be able to accelerate repayment of such notes upon such event of
default and enforce their security under the Alternative New Senior
Notes (as noted above) without further recourse to shareholder
approval. Additionally, there would be cross-defaults to the
Group's other facilities which would allow the relevant holders
and/or lenders to accelerate the repayment of such facilities at
such time. Accordingly, any failure by Shareholders to approve the
terms of the disposal of all or substantially all of the Group's
assets would allow holders of the Alternative New Senior Notes, as
well as the Group's other secured lenders, to enforce their
security and Shareholders would be unlikely to receive any return
of income or capital by the Company following such enforcement.
In addition to the outstanding aggregate principal amount of
US$1,789 million due under the Alternative New Senior Notes, the
New 2019 Notes, the New 2020 Notes, the New 2021 Notes, the Amended
Ebok Facility, the Amended Okwok/OML 113 Facility and the OML 26
Facility, payment in kind interest will accrue on the Alternative
New Senior Notes (under the New Senior PIK Notes and the New Junior
PIK Notes) as specified above, as well as cash and payment in kind
interest accruing on the Group's other indebtedness. Accordingly,
it is highly likely that the value of the Group's debt will exceed
the value of the Group if the Group is sold or if the Group's
assets are sold as required by the terms of the Alternative New
Senior Notes.
Therefore, if Shareholders do not approve the Resolution at the
General Meeting, including granting authority for the issue of new
Ordinary Shares in connection with the Restructuring, it is
expected that the economic terms of the Alternative Restructuring
(being the terms of the Alternative New Senior Notes, the
obligation to pay US$934 million in principal (and interest) under
the New 2019 Notes, the New 2020 Notes and the New 2021 Notes,
together with the requirement to initiate a sale of the Group's
business), will mean that the Shareholders would be unlikely to
receive any proceeds from the sale of the Group or the required
disposal of the Group's assets or other return of income or capital
by the Company, and therefore the Shareholders would be unlikely to
see any return of their current investment.
APPENDIX II
Definitions
The following definitions apply in this announcement unless the
context requires otherwise.
2016 Notes the senior secured notes due
1 February 2016;
2019 Notes the senior secured notes due
8 April 2019;
2020 Notes the senior secured notes due
9 December 2020;
Alternative Restructuring the Restructuring, on adjusted
terms arising as a result of
a failure by Shareholders to
approve the Resolution by the
requisite majority;
Amended Ebok Facility the amendment agreement entered
into between Afren and the
Ebok Lenders in respect of
the Ebok Facility;
Amended Okwok/OML the amendment agreement with
113 Facility Access Bank in respect of the
Okwok/OML 113 Facility;
Bridge Noteholders holders of the Bridge Securities
and certain of their respective
affiliates;
Bridge Securities the US$211,640,211.64 million
of private placement notes
due 25 April 2016 issued by
the Company in connection with
the Interim Funding pursuant
to the Note Purchase Agreement;
Bridge Securities the new Ordinary Shares to
Share Issue be issued to Bridge Noteholders
(or their nominees), in an
aggregate amount representing
5% of the fully diluted share
capital of the Company following
the completion of the Debt
for Equity Swap, the New Senior
Notes Share Issue, the Open
Offer and the Early Subscriber
Issue;
Companies Act the UK Companies Act 2006 (as
amended);
Debt for Equity the release and conversion
Swap into equity of 25% of the face
value of the outstanding principal
amount (and accrued interest)
of the Existing Notes (being
US$234 million) pursuant to
the issue of new Ordinary Shares
to Existing Noteholders, which
will result in Existing Noteholders
holding 80% of the increased
share capital of the Company
immediately following such
conversion;
Early Subscriber the additional new Ordinary
Issue Shares representing 10% of
the fully diluted share capital
of the Company to be issued
to certain of the Existing
Noteholders who subscribed
for New Senior Notes following
the completion of the Debt
for Equity Swap, the New Senior
Notes Share Issue, the Open
Offer and the Bridge Securities
Share Issue;
Ebok Facility the US$300 million revolving
credit facility dated 24 March
2010, as amended and restated
on 23 June 2010, 3 March 2011
and 22 March 2013, between
Afren Resources, Afren and
the Ebok Lenders in respect
of Ebok;
Ebok Intercreditor the intercreditor agreement
Agreement dated 3 February 2011 between,
among others, Afren, the trustee
for the 2016 Notes and BNP
Paribas (in its capacities
as Senior Agent and security
agent for the lenders under
the Ebok Facility and also
in its capacity as Ebok Collateral
Agent);
Ebok Lenders BNP Paribas, Citibank, N.A.,
London Branch, Natixis, Deutsche
Bank AG, Amsterdam Branch,
Firstrand Bank Limited, acting
through its Rand Merchant Bank
Division, Merrill Lynch International
Bank Limited, London, Nedbank
Limited, London Branch, Sumitomo
Mitsui Banking Corporation
Europe Limited, Stanbic IBTC
Bank Plc and Standard Chartered
Bank and any bank or financial
institution which accedes to
the Ebok Facility;
Excluded Territories Australia, Canada, Japan, New
Zealand and the Republic of
South Africa, and each an "Excluded
Territory";
Existing Noteholders holders of Existing Notes;
Existing Notes the 2016 Notes, the 2019 Notes
and/or the 2020 Notes, as applicable;
Existing Shares the existing Shares of 1 pence
each in nominal value in the
capital of the Company as at
the date of this document;
General Meeting the general meeting of the
Shareholders to be held at
11.00 a.m. on 24 July 2015;
ICA 2 the additional Ebok intercreditor
agreement;
ICA 3 the separate Ebok intercreditor
agreement;
Interim Funding the provision of US$200 million
in net interim funding pursuant
to the Note Purchase Agreement;
New 2019 Notes approximately US$350 million
of new notes due 2019 to be
issued by the Notes Issuer;
New 2020 Notes approximately US$350 million
of new notes due 2020 to be
issued by the Notes Issuer;
New 2021 Notes under the Alternative Restructuring,
the reinstatement of the Existing
Notes as a new series of notes
that will become due in December
2021, with interest at 20.2%
per annum payable in kind;
New Junior PIK the new junior payment in kind
Notes notes due no earlier than six
months after the maturity date
of the Amended Ebok Facility;
New Senior Notes the new senior notes due August
2017 to be issued by the Company
pursuant to the Scheme;
New Senior Notes the new Ordinary Shares to
Share Issue be issued to holders of New
Senior Notes in accordance
with the Scheme;
New Senior PIK the new senior payment in kind
Notes notes due August 2017;
Note Purchase Agreement the agreement entered into
on 30 April 2015 by the Company,
the Bridge Noteholders and
Wilmington Trust (London) Limited
in respect of the issue of
the Bridge Securities;
Notes Issuer Afren Finance plc, a newly
incorporated direct subsidiary
of the Company;
Notes Issuer Guarantor Afren International Limited,
a newly incorporated direct
subsidiary of the Company;
Notice of General the notice of the general meeting
Meeting of Shareholders;
Okwok/OML 113 Facility the bridge loan facility entered
into between Afren Exploration
& Production Nigeria Alpha
Limited, as borrower, and Afren
and FHN 113 Limited, as guarantors,
pursuant to an offer letter
dated 30 September 2014;
OML 26 Facility the US$100 million loan agreement
dated 25 February 2014 made
between FHN 26 as borrower
and Zenith Bank plc as lender;
Okwok/OML 113 Lender Access Bank;
Open Offer the pre-emptive open offer
to all Shareholders, comprising
up to GBP49.2 million in new
Ordinary Shares;
Open Offer Entitlements the invitation by Afren to
Qualifying Shareholders to
apply to acquire 4 Open Offer
Shares for every 9 Existing
Shares at a price of 1 pence
per Open Offer Share;
Open Offer Shares The up to 4,922,491,218 Ordinary
Shares being offered by the
Company to Qualifying Shareholders
pursuant to the Open Offer;
Ordinary Shares the ordinary shares in the
or Shares share capital of Afren, comprising
(i) before the Sub-Division,
ordinary shares of 1 pence
each (ii) after the Sub-Division
and before the Consolidation,
ordinary shares of 0.00001
pence each and (iii) after
the Consolidation, ordinary
shares of 0.0001 pence each;
Qualifying non--CREST Qualifying Shareholders holding
Shareholders Existing Shares in certificated
form who are not resident in
an Excluded Territory or the
United States;
Qualifying Shareholder shareholder(s) on Afren's register
of members on the Record Date;
Record Date close of business on 6 August
2015;
Resolution the resolution to be proposed
at the General Meeting (and
set out in the Notice of General
Meeting at the end of this
document) to, among other things,
facilitate and approve the
Open Offer and the issue of
the New Shares;
Restructuring the financial, debt and corporate
restructuring of the Group
contemplated by the Scheme,
the Restructuring documents
and the explanatory statement
to the Scheme, including (but
not limited to) any and all
connected compromises/agreements
with persons that are not parties
to the Scheme;
RWC Scenario the Company's reasonable worst
case scenario to its working
capital requirements;
Scheme the scheme of arrangement under
Part 26 of the Companies Act
between Afren and the Scheme
Creditors, with any modification,
addition or condition which
the Court may think fit to
approve or impose;
Scheme Creditors the persons with a beneficial
interest as principal in the
Existing Notes held in global
form through the Common Depositary
at the Record Date (as defined
in the Scheme);
Security Reorganisation the transfer of all or substantially
all assets of the Group to
the Notes Issuer or the Notes
Issuer Guarantor, in satisfaction
of the relevant condition to
the Scheme; and
Shareholder a holder of Shares.
Notes
This announcement is for information purposes only and does not
constitute an invitation or offer to buy, sell, issue, underwrite,
acquire or subscribe for, or the solicitation of an offer to buy,
sell, issue, acquire or subscribe for any securities, nor shall
there be any sale of securities in any jurisdiction in which such
offer, solicitation or sale would be unlawful. Any failure to
comply with these restrictions may constitute a violation of the
securities laws of such jurisdictions.
In particular, this announcement does not constitute or form
part of any offer to buy, sell, issue, acquire or subscribe for, or
the solicitation of an offer to buy, sell, issue, acquire, or
subscribe for, any securities in Australia, Canada, Japan, the
Republic of South Africa or any other jurisdiction into which such
offer or solicitation would be unlawful. No public offering of the
securities referred to herein is being made in the United Kingdom,
Australia, Canada, Japan, the Republic of South Africa or any other
jurisdiction.
This announcement is not an offer of securities for sale in the
United States. The securities referred to above have not been, and
will not be, registered under the United States Securities Act of
1933, as amended (the "US Securities Act"), and may not be offered
or sold in the United States absent registration or an exemption
from registration as provided in the US Securities Act and the
rules and regulations thereunder. There has not been and will not
be a public offer of the securities in the United States.
The distribution of this announcement in certain jurisdictions
may be restricted by law. No action has been taken that would
permit an offering of any securities or possession or distribution
of this announcement or any other offering or publicity material
relating to such securities in any jurisdiction where action for
that purpose is required. Persons into whose possession this
announcement comes are required to inform themselves about, and to
observe, such restrictions. Any failure to comply with these
restrictions may constitute a violation of the securities laws of
any such jurisdiction.
Disclaimer and cautionary note on forward looking statements and
notes on certain other matters
Certain statements in this announcement are not historical facts
and are or are deemed to be "forward-looking". The Company's
prospects, plans, financial position and business strategy, and
statements pertaining to the capital resources, future expenditure
for development projects and results of operations, may constitute
forward-looking statements. In addition, forward-looking statements
generally can be identified by the use of forward-looking
terminology including, but not limited to; "may", "expect",
"intend", "estimate", "anticipate", "plan", "foresee", "will",
"could", "may", "might", "believe" or "continue" or the negatives
of these terms or variations of them or similar terminology.
Although the Company believes that the expectations reflected in
these forward-looking statements are reasonable, it can give no
assurance that these expectations will prove to have been correct.
These forward-looking statements involve a number of risks,
uncertainties and other facts that may cause actual results to be
materially different from those expressed or implied in these
forward-looking statements because they relate to events and depend
on circumstances that may or may not occur in the future and may be
beyond Afren's ability to control or predict. Forward-looking
statements are not guarantees of future performances.
Factors, risks and uncertainties that could cause actual
outcomes and results to be materially different from those
projected include, but are not limited to, the following: risks
relating to changes in political, economic and social conditions in
the countries in which Afren operates; future prices and demand for
the Company's products; global oil production; trends in the oil
& gas industry and domestic and international oil & gas
market conditions; risks in oil & gas operations; future
expansion plans and capital expenditures; the Company's
relationship with, and conditions affecting, the Company's partners
and regulators; competition; weather conditions or catastrophic
damage; risks relating to law, regulations and taxation in the
countries in which Afren operates, including laws, regulations,
decrees and decisions governing the oil & gas industry, the
environment and currency and exchange controls and their official
interpretation by governmental and other regulatory bodies and by
the courts; and risks relating to global economic conditions and
the global economic environment. Additional risk factors are as
described in the Company's annual report.
Forward-looking statements are made only as of the date of this
announcement. The Company expressly disclaims any obligation or
undertaking to release, publicly or otherwise, any updates or
revisions to any forward-looking statement contained in this
announcement to reflect any change in its expectations or any
change in events, conditions, assumptions or circumstances on which
any such statement is based unless so required by applicable
law.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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