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New Sevan Successfully Places Shares
On Monday, Sevan Marine ASA announced that its offering and listing of up to 21,037,428 shares was fully subscribed. At an offering price of NOK 6.70/share gross proceeds raised were NOK 149,950,768 or approximately $25 million. Proceeds of the offering will be used for near term liquidity and general corporate purposes.
Part of the restructuring of the company, these shares were directed to former shareholders of Sevan and the unsecured bondholders who received unsecured bondholder shares in the unsecured debt conversion. This offering also provides for the listing of the directed placement of 21,047,276 new shares towards an affiliate of Teekay Corporation for NOK 141 million and the 5,261,595 new shares already issued pursuant to a conversion of the 14% Sevan Callable Senior Unsecured Bond Issue 2010/2014.
De Facto Dropdown – Teekay Offshore to Acquire Sevan Piranema
As part of the larger global agreement to acquire three FPSOs from Sevan Marine ASA, Teekay Corporation and Teekay Offshore GP LLC have agreed that Teekay Offshore Partners L.P. will acquire the Sevan Piranema, directly from Sevan, for approximately $165 million, subject to working capital adjustments. With a firm seven years remaining on its charter to Petrobras, it is one of two rigs in the package that has a minimum of three years employment necessary to meet Teekay Offshore’s parameters for purchase.
Terms Disclosed – Teekay Acquires FPSOs and Invests for the Long-term
On Tuesday, Sevan Marine ASA and Teekay Corporation announced the terms of the previously disclosed acquisition of three FPSOs from Sevan , which received the blessing of two-thirds of the holders of each of Sevan’s bond loans, and the proposed equity investment in the recapitalized Sevan.
Teekay will acquire the three FPSO units, the Sevan Piranema, the Sevan Hummingbird and Sevan Voyageur, together with their existing contracts for an aggregate purchase price of $668 million plus the remaining upgrade cost of the Voyageur which is estimated to be $110-$130 million. The first two will be acquired at closing which is anticipated to occur in Q4 2011, with the Voyageur being acquired upon commencement of its charter with E.ON, which is expected to occur in Q3 2012. Based upon his EBITDA projection of $120 million, Omar Nokta of Dahlman Rose estimates that Teekay is paying a multiple of only 6.5x.
Evensen Strikes – TK Agrees to Acquire Three FPSOs from Sevan and Invest in Recapitalization
Teekay Corporation was identified last week as the unnamed industrial partner involved in the on-going restructuring process taking place at Sevan Marine ASA. With details to be forthcoming, the companies did, however, announce the basic framework of the transaction, which has been approved by the respective Boards of Directors, but requires the acceptance of other key stakeholders including the bondholders, existing shareholders and the charterers.
Briefly, Teekay will acquire from Sevan the three FPSO units, the Hummingbird, the Piranema and the Voyager along with their existing charters. The Voyager will be acquired upon completion of the current upgrade, which Teekay has agreed to finance. In addition, Teekay has agreed to take a significant ownership position in a recapitalized Sevan. Lastly, it has locked in future growth by entering into a cooperation agreement to acquire future FPSO projects developed by Sevan.
Sole Ownership – TOO Buys Teekay’s Remaining Interest in OPCO
Today, Teekay Corporation announced the sale of its remaining 49% interest in Teekay Offshore Operating L.P. (“OPCO”) to Teekay Offshore Partners L.P. (“TOO”) for a total consideration of $390 million, valuing the company at $796 million. OPCO currently operates a fleet of 33 shuttle tankers (including five chartered-in vessels), four Floating Storage and Offtake (FSO) units, nine double-hull conventional oil tankers and two lightering vessels.
The Other 49%
Teekay Offshore Partners is in the process of considering Teekay Corporation’s offer to sell it the remaining 49% interest in Teekay Offshore Operating L.P. (“OPCO”) that it doesn’t own. Payment would be made in a combination of cash and Teekay Offshore common units. No new units are expected to be sold to the public to finance this transaction.
OPCO currently operates a fleet of 33 shuttle tankers, of which five are chartered-in, four FSO units, nine double hull oil tankers and two lightering vessels.
And Another Exciting Career Move
On Tuesday, Teekay Corporation announced that it’s President and CEO Bjorn Moller intends to retire from these roles in the spring of 2011 after 25 years of service. As Sean Day, Teekay’s Chairman notes, “Bjorn has been an exceptional and visionary leader of Teekay during his time as CEO. He has done a superb job of developing and implementing the strategies that have transformed the Company into a world leader in the marine energy industry over the past decade. We are grateful to Bjorn for his enormous passion and commitment to Teekay over so many years. I am pleased that Bjorn has accepted our invitation to remain on our Board of Directors after he steps down next spring so that we may continue to draw on his tremendous experience and expertise.”
“Progress Is Our Most Important Product” – Ridgebury Filing Amended
As an alumnus, Bob Burke can readily identify with the GE slogan referred to above as his IPO moves forward. We missed the first amendment to the Ridgebury Tanker filing earlier this month, in which the initial targeted vessels are identified. The company has entered into MOAs to acquire four identical sisters, built at Bohai Shipbuilding Heavy Industries Co. Ltd from Teekay Corporation as follows:
Blowout!
As a seasoned issuer, Teekay Corporation wasted no in pricing what was expected to be $300 million of senior unsecured notes due in 2020. On Friday, not only did they announce highly competitive pricing, but also that the offering had been upsized by 50% to $450 million.
With a coupon of 8.5%, the deal was priced at 99.181% to yield 8.625% or 492 bps over like term Treasuries. Details of the transaction are shown in the Guts of the Deal below.
Swap to Extend
On Tuesday, Teekay Corporation announced a cash tender offer for all of its outstanding 8.875% Senior Notes due 2011. As of December 31, 2009, $176.6 million aggregate principal amount of these notes were outstanding. The total consideration for the tender offer will be $1,078 per $1,000 principal amount, consisting of a tender offer premium of $60 and a consent payment of $18 for early tenders. The offer, managed by J.P. Morgan, is scheduled to expire February 9th.
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