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Cairn Energy PLC (CNE)

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Wednesday 13 June, 2012

Cairn Energy PLC

Offer for Nautical Petroleum plc

RNS Number : 2566F
Cairn Energy PLC
13 June 2012
 

Part I

Not for release, publication or distribution, in whole or in part, directly or indirectly, in, into or from any jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction.

FOR IMMEDIATE RELEASE                                                                          13 June 2012

Recommended Cash Offer

by

Capricorn Energy Limited ("Capricorn"), a wholly-owned subsidiary of Cairn Energy PLC ("Cairn")

for

Nautical Petroleum plc ("Nautical")

(to be implemented by way of a Scheme of Arrangement under Part 26 of the Companies Act)

Summary

·           The boards of Cairn and Nautical are pleased to announce that they have reached agreement on the terms of a recommended cash offer to be made by Capricorn for the entire issued and to be issued share capital of Nautical (the "Offer").  It is intended that the Offer will be effected by way of a Court sanctioned scheme of arrangement under Part 26 of the Companies Act.

·           Under the terms of the Offer, Nautical Shareholders will be entitled to receive 450 pence in cash for each Nautical Share held.

·           The Offer values the issued and to be issued share capital of Nautical at approximately £414 million. (Nautical held cash and deposits of £69.9 million at 31 December 2011.)

·           The Offer Price represents a premium of approximately:

51.1% to the closing price of 297.8 pence per Nautical Share on 12 June 2012, the Business Day immediately prior to the date of this announcement; and

45.3% to the average closing price of 309.8 pence per Nautical Share over the three month period ended 12 June 2012.

·           The Cairn Directors believe that the acquisition of Nautical is an attractive opportunity to expand its existing portfolio in North-West Europe and to continue its strategy of balancing its transformational exploration portfolio with appraisal and development assets.  Specifically Nautical would:

increase Cairn's interest in UK Licence PL1430 (the Catcher area), including the Catcher, Burgman, Carnaby and Varadero oil discoveries, by 15%, taking Cairn's overall interest to 30%;

provide Cairn with a 25% interest in Kraken, another large, North Sea oil development project;

provide Cairn with a 6% interest in the Mariner oil field, planned for development sanction by the operator, Statoil;

provide Cairn with a minimum of a 50% interest in Block 9/1a (UK Licence P1759) and the associated Ketos prospect;

provide Cairn with additional growth potential through an active near-term exploration and appraisal programme in the UK North Sea;

add to Cairn's growing contingent resource base with 86 million barrels of 2C contingent resources; and

enable Cairn to build on the achievements of Nautical in the North Sea by applying Cairn's expertise and access to capital to further create value from Nautical's asset base.

·           Cairn is an oil and gas exploration and production company incorporated in Scotland. It has a market capitalisation of approximately £1.8 billion and its shares are listed on the Official List and traded on the main market of the London Stock Exchange. Cairn's principal assets include: its 21.8% investment in Cairn India Limited ("Cairn India"); the largest exploration acreage position of any company in Greenland; through the recently completed acquisition of Agora Oil & Gas AS ("Agora"), non-operated exploration, appraisal and development assets in the United Kingdom and Norwegian North Sea; and other prospective exploration positions in the Mediterranean. 

·           Nautical is an independent oil and gas exploration and production company, incorporated in England and Wales and headquartered in London. Nautical's oil and gas assets consist of development assets in the United Kingdom North Sea (including interests in the Catcher, Kraken and Mariner fields) and exploration assets in the United Kingdom, Ireland and France.

·           The Nautical Directors, who have been so advised by Investec, consider the terms of the Offer to be fair and reasonable.  In providing its advice to the Nautical Directors, Investec has taken into account the commercial assessments of the Nautical Board. Accordingly, the Nautical Directors intend to unanimously recommend that Nautical Shareholders vote in favour of the Scheme at the Court Meeting and the resolution to be proposed at the General Meeting, as the Nautical Directors have irrevocably undertaken to do in respect of their entire beneficial holdings of Nautical Shares, amounting to, in aggregate, 1,915,192 Nautical Shares, representing approximately 2.18% of the issued share capital of Nautical at the date of this announcement.

·           Capricorn has also received irrevocable undertakings to vote in favour of the Scheme at the Court Meeting and the resolution to be proposed at the General Meeting in respect of 5,889,251 Nautical Shares, representing approximately 6.71% of the issued share capital of Nautical as at the date of this announcement.

·           Capricorn has also received letters indicating an intention to vote in favour of the Scheme at the Court Meeting and the resolution to be proposed at the General Meeting in respect of 16,110,316 Nautical Shares, representing approximately 18.36% of the issued share capital of Nautical as at the date of this announcement.

·           Capricorn has therefore received irrevocable undertakings and letters of intent over a total of 23,914,759 Nautical Shares, representing approximately 27.25% of the issued share capital of Nautical as at the date of this announcement.

·           The cash consideration payable under the terms of the Offer will be funded using Capricorn's existing cash resources.

·           The Offer is subject to the approval of Nautical Shareholders and the other Conditions and further terms set out in Appendix I and to the full terms and conditions to be set out in the Scheme Document.

·           Subject to satisfaction of the Conditions, the Scheme is expected to become effective in August 2012. The Scheme Document setting out further details of the Scheme, the expected timetable and the procedure to be followed will be despatched to Nautical Shareholders as soon as practicable.

·           The Offer will be considered by Nautical Shareholders at the Court Meeting and at the General Meeting. In order to become effective, the Scheme must be approved by a majority in number of the Nautical Shareholders entitled to vote and present and voting at the Court Meeting, either in person or by proxy, and representing at least 75% in value of the Nautical Shares voted. In addition, a resolution concerning certain matters necessary to implement the Scheme and approve the related Capital Reduction must be passed by 75% of votes cast by Nautical Shareholders present and voting at the General Meeting.

Commenting on the Offer, Simon Thomson, Chief Executive of Cairn said:

"We are pleased to reach agreement with the Board of Nautical, which has unanimously recommended our proposed offer, and we look forward to building on what they have achieved with the business to date.

This acquisition is another step towards building a balanced portfolio of transformational exploration, appraisal and development assets, and complements our recent acquisition of Agora to help build a platform in North West Europe.

Specifically we will increase our equity position in the Catcher area, which contains several oil discoveries and follow-on prospectivity, and acquire a material stake in Kraken, another large, North Sea oil development project.

In addition to these discoveries, this acquisition will add a number of North Sea exploration prospects to our existing 2012 and 2013 exploration programme in the UK and Norway."

Commenting on the Offer, Steve Jenkins, Chief Executive of Nautical said:

"We are pleased to announce Cairn's recommended offer to our shareholders.  As a Board we feel the Offer recognises the significant value in Nautical's portfolio and provides our shareholders with the opportunity to crystallise this value, with certainty in cash, today.

 

Since Nautical's inception and IPO in 2005 we have built a significant company with an outstanding record of hydrocarbon discoveries and commercial success.  I would like to thank my fellow directors, employees and consultants at Nautical, who have been instrumental in delivering these outstanding results.

 

We believe that Cairn's technical abilities and financial strength can continue the company's successful track record and bring further benefits for our employees and partners."

This summary should be read in conjunction with the full text of the following announcement including the Appendices.  The Conditions and certain further terms of the Offer are set out in Appendix I to this announcement.  Appendix II sets out the sources and bases of certain financial and other information contained in this announcement.  Appendix III contains details of the irrevocable undertakings and letters of intent given to Capricorn.  Appendix IV contains the definitions of certain terms used in this announcement.

Enquiries:

 

 

Cairn Energy PLC

Tel: +44 131 475 3000 

Simon Thomson, Chief Executive

Mike Watts, Deputy Chief Executive

Jann Brown, Managing Director and CFO

David Nisbet, Corporate Affairs 

 

 

 

Rothschild (financial adviser to Cairn Energy PLC)

Tel:  +44 20 7280 5000

James Smith

 


 

Brunswick (public relations adviser to Cairn Energy PLC)

Tel:  +44 20 7404 5959

Patrick Handley

 

David Litterick

 

 

Nautical Petroleum plc

 

Tel: +44 20 7647 0120

Steve Jenkins, Chief Executive

 

Paul Jennings, Commercial Director

Will Mathers, Finance Director

 

 

 

Investec (financial adviser, nominated adviser and joint broker to Nautical Petroleum plc)

Tel:  +44 20 7597 5970

Chris Sim

 

Neil Elliot

 


 

RBC Capital Markets (joint broker to Nautical Petroleum plc)

Tel: +44 20 7653 4000

Tim Chapman

 

Matthew Coakes

 


 

 

Buchanan (public relations adviser to Nautical Petroleum plc)

 

Tel:  +44 20 7466 5000

Tim Thompson

Ben Romney

Helen Chan

 

 

 

Conference Call

There will be an analyst conference call at 8.30 a.m. (UK time). 

Presentation slides will be available on Cairn's website at www.cairnenergy.com from 7.00 a.m. (UK time).

Dial-In:

UK Free Call                              0800 073 1809

Standard International                 +44 (0) 1452 542 400

Conference ID                           87981826

A recording of the conference call will be available by 4.00 p.m. (UK time), Wednesday 13 June 2012 until Friday 22 June 2012 by dialling 08009531533 free from the UK or +44 (0) 1452550000 internationally and using the access number: 87981826#

Transcript

A transcript of the conference call will be available on Cairn's website at www.cairnenergy.com as soon as possible after the event.

 

Further information

This announcement is for information purposes only and is not intended to and does not constitute, or form part of, any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Offer or otherwise.

This announcement does not constitute a prospectus or prospectus equivalent document. The Offer will be made solely on the basis of information contained or referred to in, or the procedures set out in, the Scheme Document and the accompanying Forms of Proxy (which will contain the full terms and conditions of the Offer).  Nautical Shareholders are advised to read the formal documentation in relation to the Offer carefully once it has been despatched.

Please be aware that addresses, electronic addresses and certain other information provided by Nautical Shareholders, persons with information rights and other relevant persons in connection with the receipt of communications from Nautical may be provided to Cairn and Capricorn during the Offer Period as required under Section 4 of Appendix 4 of the Code.

N M Rothschild & Sons Limited ("Rothschild"), which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Cairn and Capricorn and no-one else in connection with the Offer and will not be responsible to anyone other than Cairn and Capricorn for providing the protections afforded to clients of Rothschild nor for providing advice in relation to the Offer or any other matters referred to herein.

Investec Bank Plc ("Investec"), which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively as financial adviser, nominated adviser and joint broker to Nautical and no-one else in connection with the Offer and will not be responsible to anyone other than Nautical for providing the protections afforded to clients of Investec nor for providing advice in relation to the Offer or any other matters referred to herein.

RBC Europe Limited ("RBC Capital Markets"), which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting as joint broker to Nautical and no-one else in connection with the Offer and will not be responsible to anyone other than Nautical for providing the protections afforded to clients of RBC Capital Markets nor for providing advice in relation to the Offer or any other matters referred to herein.

Overseas jurisdictions

The availability of the Offer in, and the release, publication or distribution of this announcement in or into, jurisdictions other than the United Kingdom may be restricted by law. In particular, as described in Appendix I, the Offer will not be made directly or indirectly into any Restricted Jurisdiction. Therefore, persons into whose possession this announcement comes who are not resident in the United Kingdom or who are subject to the laws of other jurisdictions should inform themselves about, and observe, any applicable restrictions.  Nautical Shareholders who are in any doubt regarding such matters should consult an appropriate independent adviser in the relevant jurisdiction without delay.  Any failure to comply with such restrictions may constitute a violation of the securities laws of any such jurisdiction.

The Offer relates to shares of a company incorporated in the United Kingdom and is proposed to be effected by means of a scheme of arrangement under the laws of England and Wales. The scheme of arrangement will relate to the shares of a company incorporated in the United Kingdom that is a "foreign private issuer" as defined under Rule 3b-4 under the US Securities Exchange Act of 1934, as amended (the "Exchange Act"). A transaction effected by means of a scheme of arrangement is not subject to proxy solicitation or tender offer rules under the Exchange Act. Accordingly, the Offer is subject to the disclosure requirements, rules and practices applicable in the United Kingdom to schemes of arrangement, which differ from the requirements of US proxy solicitation and tender offer rules. Financial information included in the relevant documentation will have been prepared in accordance with accounting standards applicable to the United Kingdom that may not be comparable to the financial statements of companies incorporated in the United States.

Unless otherwise determined by Capricorn or required by the Code, and permitted by applicable law and regulation, the Offer will not be made available, directly or indirectly, in, into or from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction and no person may vote in favour of the Offer by any such use, means, instrumentality or form within a Restricted Jurisdiction or any other jurisdiction if to do so would constitute a violation of the laws of that jurisdiction. Accordingly, copies of this announcement and all documents relating to the Offer are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in, into or from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction, and persons receiving this announcement and all documents relating to the Offer (including custodians, nominees and trustees) must not mail or otherwise distribute or send them in, into or from such jurisdictions where to do so would violate the laws in that jurisdiction.

Any person (including, without limitation, as custodian, nominee or trustee) who would or otherwise intends to, or who may have a contractual or legal obligation to forward this announcement and / or the Scheme Document and / or any other related document to any jurisdiction outside of the United Kingdom should inform themselves of, and observe, any applicable legal or regulatory requirements of their jurisdiction before taking any action.

This announcement has been prepared for the purposes of complying with English law and the Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of any jurisdiction outside the United Kingdom.

Disclosure requirements

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any paper offeror is first identified.

An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 p.m. (London time) on the 10th Business Day following the commencement of the offer period and, if appropriate, by no later than 3.30 p.m. (London time) on the 10th Business Day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of an offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of an offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. (London time) on the Business Day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129.

Forward-looking statements

This announcement contains certain forward-looking statements, including statements regarding Cairn's, Capricorn's and Nautical's plans, objectives and expected performance.  These forward-looking statements can be identified by the fact they do not only relate to historical or current facts. Forward-looking statements often use words such as "anticipate", "target", "expect", "estimate", "intend", "plan", "goal", "believe", "will", "may", "should", "would", "could" or other words of similar meaning. Such statements relate to events and depend on circumstances that will occur in the future and are subject to risks, uncertainties and assumptions. There are a number of factors which could cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements, including, among others the enactment of legislation or regulation that may impose costs or restrict activities; the re-negotiation of contracts or licences; fluctuations in demand and pricing in the oil industry; fluctuations in exchange controls; changes in government policy and taxation; industrial disputes; war and terrorism. In particular, there are uncertainties inherent in estimating the quantity of reserves and resources and in projecting future rates of production, including factors beyond Cairn's and Nautical's control. Estimating the amount of hydrocarbon reserves and resources is a subjective process and, in addition, the results of drilling, testing and production subsequent to the date of an estimate may result in revisions to original estimates. Whilst reserves are stated in accordance with Petroleum Resources Management System (PRMS) approved in March 2007 by the Society of Petroleum Engineers, the World Petroleum Council, the American Association of Petroleum Geologists and the Society of Petroleum Evaluation Engineers, prospective investors should be aware that certain categories of reserves and resources (such as prospective and contingent resources) are inherently less certain than certain other categories (such as proved reserves).

The reader is cautioned not to place undue reliance on these forward-looking statements which speak only as at the date of this document. Such statements are based on the assumptions and assessments made by the Nautical Directors, the Cairn Directors and the Capricorn Directors. Although the Nautical Directors, the Cairn Directors and the Capricorn Directors believe that the expectations reflected in such forward-looking statements are reasonable, none of Cairn, Capricorn or Nautical can give any assurance that such expectations will prove to have been correct and none of Cairn, Capricorn or Nautical undertakes any obligation to update or revise any forward-looking statement in this announcement except as required by applicable law or regulation.

Publication of this announcement on Cairn and Nautical websites

A copy of this announcement will be available, subject to certain restrictions relating to persons resident in any Restricted Jurisdictions, on www.cairnenergy.com and www.nauticalpetroleum.com by no later than 12:00 noon (London time) on 14 June 2012 (being the day following the date of this announcement) in accordance with Rule 30.4 of the Code.

The contents of Cairn's website and Nautical's website are not incorporated into and do not form part of this announcement.

Rule 2.10 disclosure

In accordance with Rule 2.10 of the Code, Nautical confirms that, as at the date of this announcement, it has in issue 87,745,179 ordinary shares of 20 pence each which are admitted to trading on AIM.  The ISIN of the Nautical Shares is GB00B3D2ND74.


Part II

Not for release, publication or distribution, in whole or in part, directly or indirectly, in, into or from any jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction.

FOR IMMEDIATE RELEASE                                                                          13 June 2012

Recommended Cash Offer

by

Capricorn Energy Limited ("Capricorn"), a wholly-owned subsidiary of Cairn Energy PLC ("Cairn")

for

Nautical Petroleum plc ("Nautical")

 

1.         Introduction

The Boards of Cairn and Nautical are pleased to announce that they have reached agreement on the terms of a recommended cash offer to be made by Capricorn for the entire issued and to be issued ordinary share capital of Nautical (the "Offer"). It is intended that the Offer will be effected by way of a Court sanctioned scheme of arrangement under Part 26 of the Companies Act.

2.         The Offer

The Offer, which will be subject to the Conditions and further terms set out in Appendix I to this announcement and to be set out in the Scheme Document, will be made on the following basis:

450p in cash

for each Nautical Share

The Offer values the entire issued and to be issued share capital of Nautical at approximately £414 million.  (Nautical held cash and deposits of £69.9 million at 31 December 2011.)

The Offer Price represents a premium of approximately:

51.1% to the closing price of 297.8 pence per Nautical Share on 12 June 2012, the Business Day immediately prior to the date of this announcement; and

45.3% to the average closing price of 309.8 pence per Nautical Share over the three month period ended 12 June 2012.

If the Scheme becomes effective, it will be binding on all Nautical Shareholders irrespective of whether or not they attended, or voted in favour of the Scheme at the Court Meeting and the resolution to be proposed at the General Meeting. 

Subject to satisfaction of the Conditions, the Scheme is expected to become effective in August 2012.  The Scheme Document setting out further details of the Scheme, the expected timetable of the Scheme and the procedures to be followed will be despatched to Nautical Shareholders as soon as reasonably practicable. 

3.         Recommendation

The Nautical Directors, who have been so advised by Investec, consider the terms of the Offer to be fair and reasonable. In providing its advice to the Nautical Directors, Investec has taken into account the commercial assessments of the Nautical Directors.

Accordingly, the Nautical Directors intend to unanimously recommend that the Nautical Shareholders vote in favour of the Scheme at the Court Meeting and the resolution to be proposed at the General Meeting, as the Nautical Directors have irrevocably undertaken to do in respect of their own beneficial shareholdings of Nautical Shares. Please see paragraph 5 of this Part II for further details of the Nautical Directors' irrevocable undertakings.

4.         Background to and reasons for the recommendation

Since its inception and IPO in 2005, Nautical has built a significant North Sea business with a proven track record of hydrocarbon discoveries and appraisal success in the Catcher and Kraken areas.

 

Instrumental to Nautical's commercial success to date has been the execution of its strategy of crystallising asset value for its shareholders at an appropriate time, whilst removing uncertainty.  This has been demonstrated by recent transactions, including:

 

·     the sale of a 20.6667% interest in Mariner in 2010 for £87.5 million; and

 

·     the sale of a 25% interest in Kraken in 2012 for a carry of up to $240 million.

 

Nautical is now on the verge of entering into the development stage on its key projects of Kraken and Catcher and in turn facing the challenges and risks of enhancing the company's resources, both technically and financially, to ensure the Company can maximise value for its shareholders in this development phase.

 

Although the Nautical Board believe Nautical would have a strong future as an independent business, it considers that Cairn's proposal of 450 pence per share is at a level which substantially recognises the Company's growth potential in the development phase, whilst providing certainty, in cash, to Nautical Shareholders today.  Furthermore, the Nautical Directors believe that there will be significant business benefits to Nautical from the combination with Cairn, including benefits of scale, access to capital and ultimately significant opportunities to enhance growth.

 

The Nautical Directors therefore intend to recommend unanimously that Nautical Shareholders vote in favour of the Scheme.

5.         Irrevocable undertakings and letters of intent

The Nautical Directors have irrevocably undertaken to vote in favour of the Scheme at the Court Meeting and the resolution to be proposed at the General Meeting in respect of their own beneficial shareholdings of Nautical Shares amounting to, in aggregate, 1,915,192 Nautical Shares representing 2.18% of Nautical's issued share capital as at the date of this announcement.  The Nautical Directors have also irrevocably undertaken to vote in favour of the Scheme at the Court Meeting and the resolution to be proposed at the General Meeting in respect of any Nautical Shares that they acquire on the exercise of options over Nautical Shares to the extent such Nautical Shares have been issued prior to the Scheme Record Voting Time.  The Nautical Directors hold options over, in aggregate, 3,515,000 Nautical Shares which, together with their existing holdings referred to above, representing approximately 5.9% of the fully diluted share capital of Nautical.

Capricorn has received irrevocable undertakings to vote in favour of the Scheme at the Court Meeting and the resolution to be proposed at the General Meeting from Anthony Lowrie and GLG Partners LP in respect of 5,889,251 Nautical Shares, representing approximately 6.71% of the issued share capital of Nautical as at the date of this announcement.

Capricorn has also received letters from Blackrock Investment Management (UK) Limited, SVM Asset Management Limited and MHR Institutional Partners II LP and MHR Institutional Partners IIA LP indicating their intention to vote in favour of the Scheme at the Court Meeting and the resolution to be proposed at the General Meeting in respect of 16,110,316 Nautical Shares, representing approximately 18.36% of the issued share capital of Nautical as at the date of this announcement.

Capricorn therefore has received irrevocable undertakings and letters of intent over a total of 23,914,759 Nautical Shares, representing approximately 27.25% of the issued share capital of Nautical as at the date of this announcement.

Further details of these irrevocable undertakings and letters of intent are set out in Appendix III to this announcement.

6.         Background to and reasons for the Offer

The proposed acquisition of Nautical builds on Cairn's strategy of growing a balanced portfolio with exposure to near-term exploration, appraisal and development leading to production and cash flow in the medium term, while continuing to offer transformational exploration.

An important first step in implementing this strategy was made with the acquisition of Agora, a private Norwegian company with exploration, appraisal and development assets in the UK and Norwegian North Sea including an interest in the Catcher development.

In this context Nautical represents an attractive acquisition opportunity, and specifically would:

·    increase Cairn's interest in UK Licence PL1430 (the Catcher area), including the Catcher, Burgman, Carnaby and Varadero oil discoveries, by 15%, taking Cairn's overall interest to 30%, with first oil targeted for end 2015;

·    provide Cairn with a 25% interest in Kraken, another large, North Sea oil development project, with first oil targeted for end 2015;

·    provide Cairn with a 6% interest in the Mariner oil field, planned for development sanction by the operator, Statoil, with first oil targeted for 2016/17;

·    provide Cairn with a minimum of a 50% interest in Block 9/1a (UK Licence P1759) and the associated Ketos prospect;

·    provide Cairn with additional growth potential through an active near-term exploration and appraisal programme in the UK North Sea;

·    add to Cairn's growing contingent resource base with 86 million barrels of 2C contingent resources; and

·    enable Cairn to build on the achievements of Nautical in the North Sea by applying Cairn's expertise and access to capital to further create value from Nautical's asset base.

7.         Information relating to Cairn

Cairn is an independent oil and gas exploration company, registered in Scotland (company registration number: SC226712), and headquartered in Edinburgh. It has a current market capitalisation of approximately £1.8 billion and its shares are listed on the Official List and traded on the main market of the London Stock Exchange.

Recently Cairn has undertaken various changes to its group structure. In December 2011, Cairn completed the sale of a 40% stake in its listed Indian subsidiary, Cairn India, to Vedanta Resources plc for gross proceeds of $6.0 billion in cash, retaining a 21.8% interest in Cairn India.  Cairn has subsequently completed a $3.5 billion return of capital to its shareholders.

Cairn India is listed on the Bombay Stock Exchange and the National Stock Exchange of India and currently has a market capitalisation at $11.0 billion based on an exchange rate of $1: INR55.816. Cairn India is primarily engaged in the business of oil and gas exploration, production and transportation. Production from Cairn India's Rajasthan operations is currently 175,000 bopd.

On 9 May 2012, Cairn announced the completion of the acquisition of Agora, a private Norwegian company with non-operated exploration, appraisal and development assets in the United Kingdom and Norwegian North Sea. Agora's portfolio is made up of interests in eleven licences in the North Sea, with an active drilling programme in 2012. Formed in October 2009 by the former management team of Revus Energy ASA, Agora is based in Stavanger, Norway.

Cairn, through its subsidiary undertaking Capricorn Oil Limited, operates eleven blocks offshore Greenland. It holds the largest portfolio of exploration assets in Greenland with acreage spanning three separate prospective basins offshore south, south-west and west Greenland. Capricorn Oil Limited also holds a number of prospective exploration positions in the Mediterranean.

In January 2012, Cairn announced the farm-out of a 30.625% working interest in the Pitu block, offshore west Greenland to Statoil ASA.

8.         Information relating to Capricorn

Capricorn is an indirect wholly-owned subsidiary of Cairn, being a direct subsidiary of Capricorn Oil Limited.  Capricorn is registered in Scotland (company registration number: SC338010).  Capricorn is the intermediate holding company for the assets held by Cairn through Capricorn Oil Limited. 

9.         Information relating to Nautical

Nautical is an independent oil and gas exploration and production company, registered in England and Wales (company registration number: 04362104), and headquartered in London.

Nautical's oil and gas assets consist of development assets in the United Kingdom North Sea (including interests in the Catcher, Kraken and Mariner fields) and exploration assets in the United Kingdom, Ireland and France.

Nautical has interests in a total of 24 licences, in the United Kingdom, Ireland and France, and is operator of six.

Nautical's profit before tax for the year ended 30 June 2011 was £50.6 million (including a gain on partial sale of United Kingdom licence P3365 (Mariner block)). For the six months ended 31 December 2011 Nautical made a loss after tax of £3.7 million.

10.       Management and employees

Cairn attaches great importance to the skills and experience of the management and employees of Nautical. Cairn confirms that, following implementation of the Offer, the existing contractual and statutory employment rights, including in relation to pensions, of all Nautical Group employees will be honoured.

11.       Financing arrangements

The cash consideration payable by Capricorn under the terms of the Offer will be financed from Cairn's existing cash resources.

Rothschild, as financial adviser to Cairn and Capricorn, is satisfied that Capricorn has the necessary financial resources available to satisfy in full the cash consideration payable to Nautical Shareholders under the terms of the Offer. 

12.       Confidentiality and Standstill Agreement

On 5 April 2012 Cairn and Nautical entered into a confidentiality and standstill agreement in a customary form in relation to the Offer, pursuant to which Cairn has undertaken, subject to certain exceptions, to keep confidential information relating to Nautical and not disclose it to third parties. These confidentiality obligations will remain in force for a period of twenty four months from the date of the confidentiality and standstill agreement. The confidentiality and standstill agreement is disclosed as referred to in paragraph 18 below.

13.       Nautical Share Schemes

The Offer will, subject to the terms and conditions set out in the Scheme Document, extend to any Nautical Shares that are issued prior to the record time for the Scheme as a result of the exercise of options granted under the Nautical Share Schemes. 

Appropriate proposals will be made to Nautical Optionholders at the same time as the Scheme Document is posted to Nautical Shareholders or as soon as reasonably practicable thereafter.

14.       Disclosure of interests in Nautical Shares

Capricorn confirms that it will make an Opening Position Disclosure on the date of this announcement, setting out the details required to be disclosed by it under Rule 8.1(a) of the Code.

15.       Structure of the Offer

It is intended that the Offer will be effected by means of a scheme of arrangement between Nautical and Nautical Shareholders under Part 26 of the Companies Act. As described in more detail in paragraph 19 below, Capricorn reserves the right to elect to implement the acquisition of Nautical, with the consent of the Panel, by way of a takeover offer within the meaning of Part 28 of the Companies Act.

The purpose of the Scheme is to provide for Capricorn to become the holder of the entire issued and to be issued ordinary share capital of Nautical. This is to be achieved by the cancellation of the ordinary shares and the application of the reserve arising from such cancellation in paying up in full a number of new Nautical Shares (which is equal to the number of ordinary shares cancelled), and issuing the same to Capricorn, in consideration for which the Nautical Shareholders will receive cash consideration on the basis set out in paragraph 2 of this announcement.

To become effective, the Scheme must be approved by a majority in number of those Nautical Shareholders entitled to vote and present and voting at the Court Meeting (either in person or by proxy) and representing at least 75% in value of the Nautical Shares voted, and the passing of the resolution proposed at the General Meeting necessary to implement the Scheme and approve the related Capital Reduction.  

The Scheme is also subject to the Conditions and further terms set out in Appendix I to this announcement and to be set out in the Scheme Document. Once the necessary approvals from Nautical Shareholders have been obtained and the other Conditions have been satisfied or (where applicable) waived, the Scheme must be approved by the Court.

Subject to satisfaction of the Conditions, the Scheme is expected to become effective in August 2012.

The Offer will lapse if the Scheme does not become effective by 14 September 2012 (or such later date as Capricorn and Nautical may, with the consent of the Panel (if required), agree and the Court may allow), provided however that such deadline for the effectiveness of the Scheme may be waived by Capricorn.

Further details of the Scheme, including an indicative timetable for its implementation, will be set out in the Scheme Document, together with notices of the Court Meeting and the General Meeting and the accompanying Forms of Proxy, which are expected to be despatched to Nautical Shareholders as soon as reasonably practicable.

16.       Delisting and re-registration

Prior to the Scheme becoming effective, Nautical will make an application for the cancellation of the admission to trading of the Nautical Shares on AIM.

Accordingly, if the Scheme is approved by Nautical Shareholders and sanctioned by the Court, the last day of dealings in Nautical Shares on AIM is expected to be the Business Day immediately prior to the Effective Date and no transfers will be registered after 6.00 p.m. on that date.

On the Effective Date, share certificates in respect of Nautical Shares will cease to be valid and entitlements to Nautical Shares held within the CREST system will be cancelled. 

It is also intended that, pursuant to the Scheme, Nautical will be re-registered as a private company under the relevant provisions of the Companies Act.

17.       Documentation

It is expected that the Scheme Document will be sent to Nautical Shareholders (other than Nautical Shareholders in Restricted Jurisdictions) as soon as practicable and in any event within 28 days of this announcement. Nautical Shareholders (other than Nautical Shareholders in Restricted Jurisdictions) who hold their Nautical Shares in certificated form will be sent Forms of Proxy together with the Scheme Document. The Scheme Document and the accompanying Forms of Proxy will be available to all Nautical Shareholders (other than Nautical Shareholders in Restricted Jurisdictions) at no charge to them on Cairn's website at www.cairnenergy.com and at Nautical's website at www.nauticalpetroleum.com. Nautical Shareholders are urged to read the Scheme Document and, where received, the accompanying Forms of Proxy when they are sent to them because they will contain important information.

18.       Display documents

Copies of the following documents will be available on the websites of Cairn and Nautical at, respectively, www.cairnenergy.com and www.nauticalpetroleum.com from 12 noon on 14 June 2012 (being the Business Day following the date of this announcement):

·          the irrevocable undertakings and letters of intent referred to at paragraph 5 above and summarised in Appendix III to this announcement; and

·          the confidentiality and standstill agreement referred to at paragraph 12 above.

19.       General

This announcement does not constitute an offer or an invitation to purchase any securities.

The Offer will comply with the applicable rules and regulations of the London Stock Exchange, the Code and the AIM Rules for Companies, will be governed by English law and will be subject to the exclusive jurisdiction of the English courts.  In addition, it will be on the terms and subject to the conditions set out in this announcement and in the Scheme Document.

Capricorn reserves the right to elect to implement the acquisition of the Nautical Shares by way of a takeover offer under Part 28 of the Companies Act as an alternative to the Scheme. In such event, the acquisition will be implemented on substantially the same terms as those which would apply to the Scheme (subject to appropriate amendments, including an acceptance condition set at 90% of the shares to which such offer relates or such lesser percentage, being more than 50%, as Capricorn may decide).

The Conditions and certain further terms of the Offer are set out in Appendix I to this announcement.  Appendix II sets out the sources and bases of certain financial and other information contained in this announcement.  Appendix III contains details of the irrevocable undertakings and letters of intent given to Capricorn.  Appendix IV contains the definitions of certain terms used in this announcement.

Enquiries:

 

 

Cairn Energy PLC

Tel: +44 131 475 3000 

Simon Thomson, Chief Executive

Mike Watts, Deputy Chief Executive

Jann Brown, Managing Director and CFO

David Nisbet, Corporate Affairs 

 

 

 

 

Rothschild (financial adviser to Cairn Energy PLC)

Tel:  +44 20 7280 5000

James Smith

 


 

Brunswick (public relations adviser to Cairn Energy PLC)

Tel:  +44 20 7404 5959

Patrick Handley

 

David Litterick

 

 

Nautical Petroleum plc

 

Tel: +44 20 7647 0120

Steve Jenkins, Chief Executive

 

Paul Jennings, Commercial Director

Will Mathers, Finance Director

 

 

 

Investec (financial adviser, nominated adviser and joint broker to Nautical Petroleum plc)

Tel:  +44 20 7597 5970

Chris Sim

 

Neil Elliot

 


 

RBC Capital Markets (joint broker to Nautical Petroleum plc)

Tel: +44 20 7653 4000

Tim Chapman

 

Matthew Coakes

 

 

Buchanan (public relations adviser to Nautical Petroleum plc)

 

Tel:  +44 20 7466 5000

Tim Thompson

Ben Romney

Helen Chan

 

 

 

 

Further information

This announcement is for information purposes only and is not intended to and does not constitute, or form part of, any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Offer or otherwise.

This announcement does not constitute a prospectus or prospectus equivalent document. The Offer will be made solely on the basis of information contained or referred to in, or the procedures set out in, the Scheme Document and the accompanying Forms of Proxy (which will contain the full terms and conditions of the Offer).  Nautical Shareholders are advised to read the formal documentation in relation to the Offer carefully once it has been despatched.

Please be aware that addresses, electronic addresses and certain other information provided by Nautical Shareholders, persons with information rights and other relevant persons in connection with the receipt of communications from Nautical may be provided to Cairn and Capricorn during the Offer Period as required under Section 4 of Appendix 4 of the Code.

N M Rothschild & Sons Limited ("Rothschild"), which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Cairn and Capricorn and no-one else in connection with the Offer and will not be responsible to anyone other than Cairn and Capricorn for providing the protections afforded to clients of Rothschild nor for providing advice in relation to the Offer or any other matters referred to herein.

Investec Bank Plc ("Investec"), which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively as financial adviser, nominated adviser and joint broker to Nautical and no-one else in connection with the Offer and will not be responsible to anyone other than Nautical for providing the protections afforded to clients of Investec nor for providing advice in relation to the Offer or any other matters referred to herein.

RBC Europe Limited ("RBC Capital Markets"), which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting as joint broker to Nautical and no-one else in connection with the Offer and will not be responsible to anyone other than Nautical for providing the protections afforded to clients of RBC Capital Markets nor for providing advice in relation to the Offer or any other matters referred to herein.

Overseas jurisdictions

The availability of the Offer in, and the release, publication or distribution of this announcement in or into, jurisdictions other than the United Kingdom may be restricted by law. In particular, as described in Appendix I, the Offer will not be made directly or indirectly into any Restricted Jurisdiction. Therefore, persons into whose possession this announcement comes who are not resident in the United Kingdom or who are subject to the laws of other jurisdictions should inform themselves about, and observe, any applicable restrictions.  Nautical Shareholders who are in any doubt regarding such matters should consult an appropriate independent adviser in the relevant jurisdiction without delay.  Any failure to comply with such restrictions may constitute a violation of the securities laws of any such jurisdiction.

The Offer relates to shares of a company incorporated in the United Kingdom and is proposed to be effected by means of a scheme of arrangement under the laws of England and Wales. The scheme of arrangement will relate to the shares of a company incorporated in the United Kingdom that is a "foreign private issuer" as defined under Rule 3b-4 under the US Securities Exchange Act of 1934, as amended (the "Exchange Act"). A transaction effected by means of a scheme of arrangement is not subject to proxy solicitation or tender offer rules under the Exchange Act. Accordingly, the Offer is subject to the disclosure requirements, rules and practices applicable in the United Kingdom to schemes of arrangement, which differ from the requirements of US proxy solicitation and tender offer rules. Financial information included in the relevant documentation will have been prepared in accordance with accounting standards applicable to the United Kingdom that may not be comparable to the financial statements of companies incorporated in the United States.

Unless otherwise determined by Capricorn or required by the Code, and permitted by applicable law and regulation, the Offer will not be made available, directly or indirectly, in, into or from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction and no person may vote in favour of the Offer by any such use, means, instrumentality or form within a Restricted Jurisdiction or any other jurisdiction if to do so would constitute a violation of the laws of that jurisdiction. Accordingly, copies of this announcement and all documents relating to the Offer are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in, into or from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction, and persons receiving this announcement and all documents relating to the Offer (including custodians, nominees and trustees) must not mail or otherwise distribute or send them in, into or from such jurisdictions where to do so would violate the laws in that jurisdiction.

Any person (including, without limitation, as custodian, nominee or trustee) who would or otherwise intends to, or who may have a contractual or legal obligation to forward this announcement and / or the Scheme Document and / or any other related document to any jurisdiction outside of the United Kingdom should inform themselves of, and observe, any applicable legal or regulatory requirements of their jurisdiction before taking any action.

This announcement has been prepared for the purposes of complying with English law and the Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of any jurisdiction outside the United Kingdom.

Disclosure requirements

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any paper offeror is first identified.

An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 p.m. (London time) on the 10th Business Day following the commencement of the offer period and, if appropriate, by no later than 3.30 p.m. (London time) on the 10th Business Day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of an offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of an offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. (London time) on the Business Day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129.

Forward-looking statements

This announcement contains certain forward-looking statements, including statements regarding Cairn's, Capricorn's and Nautical's plans, objectives and expected performance.  These forward-looking statements can be identified by the fact they do not only relate to historical or current facts. Forward-looking statements often use words such as "anticipate", "target", "expect", "estimate", "intend", "plan", "goal", "believe", "will", "may", "should", "would", "could" or other words of similar meaning. Such statements relate to events and depend on circumstances that will occur in the future and are subject to risks, uncertainties and assumptions. There are a number of factors which could cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements, including, among others the enactment of legislation or regulation that may impose costs or restrict activities; the re-negotiation of contracts or licences; fluctuations in demand and pricing in the oil industry; fluctuations in exchange controls; changes in government policy and taxation; industrial disputes; war and terrorism. In particular, there are uncertainties inherent in estimating the quantity of reserves and resources and in projecting future rates of production, including factors beyond Cairn's and Nautical's control. Estimating the amount of hydrocarbon reserves and resources is a subjective process and, in addition, the results of drilling, testing and production subsequent to the date of an estimate may result in revisions to original estimates. Whilst reserves are stated in accordance with Petroleum Resources Management System (PRMS) approved in March 2007 by the Society of Petroleum Engineers, the World Petroleum Council, the American Association of Petroleum Geologists and the Society of Petroleum Evaluation Engineers, prospective investors should be aware that certain categories of reserves and resources (such as prospective and contingent resources) are inherently less certain than certain other categories (such as proved reserves).

The reader is cautioned not to place undue reliance on these forward-looking statements which speak only as at the date of this document. Such statements are based on the assumptions and assessments made by the Nautical Directors, the Cairn Directors and the Capricorn Directors. Although the Nautical Directors, the Cairn Directors and the Capricorn Directors believe that the expectations reflected in such forward-looking statements are reasonable, none of Cairn, Capricorn or Nautical can give any assurance that such expectations will prove to have been correct and none of Cairn, Capricorn or Nautical undertakes any obligation to update or revise any forward-looking statement in this announcement except as required by applicable law or regulation.

Publication of this announcement on Cairn and Nautical websites

A copy of this announcement will be available, subject to certain restrictions relating to persons resident in any Restricted Jurisdictions, on www.cairnenergy.com and www.nauticalpetroleum.com by no later than 12:00 noon (London time) on 14 June 2012 (being the day following the date of this announcement) in accordance with Rule 30.4 of the Code.

The contents of Cairn's website and Nautical's website are not incorporated into and do not form part of this announcement.

Rule 2.10 disclosure

In accordance with Rule 2.10 of the Code, Nautical confirms that, as at the date of this announcement, it has in issue 87,745,179 ordinary shares of 20 pence each which are admitted to trading on AIM.  The ISIN of the Nautical Shares is GB00B3D2ND74.


APPENDIX I

PART A

The Offer is conditional upon the Scheme becoming unconditional and effective by not later than 14 September 2012, or such later date (if any) as Capricorn and Nautical may, with the consent of the Panel (if required), agree and the Court may allow.

Conditions of the Offer

1.   The Scheme will be conditional upon:

(a)          its approval by a majority in number representing 75% or more in value of Nautical Shareholders (or any relevant class or classes thereof) who are on the register of members of Nautical at the Scheme Voting Record Time and who are present and vote, either in person or by proxy, at the Court Meeting (or at any adjournment of such meeting);
(b)          the resolution required to implement the Scheme and approve the related Capital Reduction as set out in the notice of the General Meeting being duly passed by the requisite majority of Nautical Shareholders at the General Meeting (or at any adjournment of such meeting);
(c)          the sanction (with or without modification, any such modification being on terms reasonably acceptable to Nautical and Capricorn) of the Scheme and the confirmation of the Capital Reduction by the Court being obtained; and
(d)          the delivery of copies of the Court Order(s) and the requisite statement of capital attached thereto to the Registrar of Companies and, if so ordered by the Court, the registration of the Court Order effecting the Capital Reduction and such statement of capital by the Registrar of Companies.

2.   The Scheme will also be conditional upon:

(a)          no indication having been made by the Office of Fair Trading that the proposed acquisition of Nautical by Capricorn or any matter arising therefrom will be referred to the Competition Commission;
(b)          without prejudice to Condition 2(c) or 2(d) below, the Secretary of State for Energy and Climate Change not having indicated an intention to: (i) revoke or recommend the revocation of any material exploration or production licence held by any member of the Wider Nautical Group (as defined below); or (ii) require a further change of control of any such member as a result of the Scheme becoming effective;
(c)          no Relevant Authority having decided to take, instituted, implemented or threatened any action, proceedings, suit, investigation, enquiry or reference, or made, proposed or enacted any statute, regulation, order or decision or taken any other steps and there not continuing to be outstanding any statute, regulation, order or decision, which would reasonably be expected to:

(i)         make the Offer or the acquisition of any Nautical Shares, or control of Nautical, by Capricorn void, illegal or unenforceable or otherwise, directly or indirectly, restrict, restrain, prohibit, delay or otherwise materially interfere with the implementation thereof in any material respect, or impose material additional conditions or obligations with respect thereto, or require material amendment thereof or otherwise challenge or interfere therewith in any material respect;

(ii)        require or prevent the divestiture by any member of the Nautical Group or any company of which 20% or more of the voting capital is held by any member of the Nautical Group or any partnership, joint venture, firm or company in which any member of the Nautical Group has a Significant Interest (the "Wider Nautical Group") or by any member of the Cairn Group or any company of which 20% or more of the voting capital is held by the Cairn Group or any partnership, joint venture, firm or company in which any member of the Cairn Group has a Significant Interest (the "Wider Cairn Group") of all or any portion of their respective businesses, assets or property or impose any limitation on the ability of any of them to conduct their respective businesses or own any of their assets or property in each case to an extent which is material in the context of the Wider Nautical Group taken as a whole or, as the case may be, the Wider Cairn Group taken as a whole;

(iii)       impose any limitation on or result in a delay in the ability of any member of the Nautical Group or the Cairn Group to acquire or to hold or to exercise effectively any rights of ownership of shares or loans or securities convertible into shares in any member of the Wider Nautical Group or of the Wider Cairn Group held or owned by it or to exercise management control over any member of the Wider Nautical Group or of the Wider Cairn Group in each case to an extent which is material in the context of the Wider Nautical Group taken as a whole or, as the case may be, the Wider Cairn Group taken as a whole;

(iv)       other than pursuant to the implementation of the Offer, require any member of the Wider Nautical Group or the Wider Cairn Group to acquire or offer to acquire any shares or other securities in any member of the Wider Nautical Group or any asset owned by any third party which is material in the context of the Wider Nautical Group taken as a whole or the Wider Cairn Group taken as a whole; or

(v)        otherwise adversely affect the assets, business, profits or prospects of any member of the Wider Nautical Group or of any member of the Wider Cairn Group in each case to an extent which is material in the context of the Nautical Group taken as a whole or, as the case may be, the Wider Cairn Group taken as a whole;

and all applicable waiting and other time periods during which any such Relevant Authority could decide to take, institute, implement or threaten any such action, proceeding, suit, investigation, enquiry or reference having expired, lapsed or been terminated;

(d)          all notifications and filings which are necessary (in the opinion of Capricorn acting reasonably) having been made, all waiting periods (including any extensions thereof) which are necessary (in the opinion of Capricorn acting reasonably) under any applicable legislation or regulations of any jurisdiction having expired, lapsed or been terminated, in each case in respect of the Offer and the acquisition of any Nautical Shares, or of control of Nautical, by Capricorn, and all Authorisations deemed necessary or appropriate in the opinion of Capricorn (acting reasonably) in any jurisdiction for, or in respect of, the Offer and the proposed acquisition of any Nautical Shares, or of control of Nautical, by Capricorn having been obtained, in terms and in a form satisfactory to Capricorn (acting reasonably), from all appropriate Relevant Authorities and from any persons or bodies with whom any member of the Wider Nautical Group has entered into contractual arrangements, in each case where the absence of such Authorisation would or would be reasonably likely to have a material adverse effect on the Wider Cairn Group taken as a whole or the Wider Nautical Group taken as a whole, and all such Authorisations remaining in full force and effect at the time at which the Scheme becomes effective and there being no notice or written intimation of an intention to revoke, suspend or modify or not to renew any such Authorisation;
(e)          except as Disclosed, there being no provision of any arrangement, agreement, licence, permit or other instrument to which any member of the Wider Nautical Group is a party or by or to which any such member or any of their assets is bound, entitled or subject to and which, in consequence of the Offer or the acquisition or proposed acquisition of any Nautical Shares, or of control of Nautical, by Capricorn, would, to an extent which is material in the context of the Wider Nautical Group taken as a whole, result in:

(i)         any monies borrowed by, or other indebtedness actual or contingent of, any such member being or becoming repayable or being capable of being declared immediately or prior to its or their stated maturity or the ability of any such member to borrow monies or incur any indebtedness being inhibited or becoming capable of being withdrawn;

(ii)        the creation or enforcement of any mortgage, charge or other security interest over the whole or any part of the business, property or assets of any such member or any such security (whenever arising or having arisen) being enforced or becoming enforceable;

(iii)       any such arrangement, agreement, licence or instrument being terminated or adversely modified or any action being taken of an adverse nature or any obligation or liability arising thereunder;

(iv)       any assets of any such member being disposed of or charged, or right arising under which any such asset could be required to be disposed of or charged, other than in the ordinary course of business;

(v)        the interest or business of any such member in or with any firm or body or person, or any agreements or arrangements relating to such interest or business, being terminated or adversely modified or affected;

(vi)       any such member ceasing to be able to carry on business under any name under which it presently does so;

(vii)      the creation of liabilities (actual or contingent) by any such member otherwise than in the ordinary course of business;

(viii)     any liability of any such member to make any severance, termination, bonus or other payment to any of its directors or officers; or

(ix)       the business, assets, value, financial or trading position, profits, prospects or operational performance of any such member being prejudiced or adversely affected,

and no event having occurred which, under any provision of any arrangement, agreement, licence or other instrument to which any member of the Wider Nautical Group is a party, or to which any such member or any of its assets is bound, entitled or subject to, would or is reasonably likely to result in any of the events or circumstances as are referred to in paragraphs (i) to (ix) of this condition (e) in each case which is material in the context of the Wider Nautical Group taken as a whole;

(f)          except as Disclosed, no member of the Wider Nautical Group having since 30 June 2011:

(i)         issued, agreed to issue or proposed the issue of additional shares or securities of any class, or securities convertible into, or exchangeable for or rights, warrants or options to subscribe for or acquire, any such shares, securities or convertible securities (save as between Nautical and wholly‑owned subsidiaries of Nautical and save for options granted, and for any Nautical Shares allotted upon exercise of options granted under the Nautical Share Schemes before the date hereof), or redeemed, purchased or reduced any part of its share capital;

(ii)        sold, transferred, or agreed to sell or transfer, any treasury shares;

(iii)       recommended, declared, paid or made or proposed to recommend, declare, pay or make any bonus, dividend or other distribution other than to Nautical or a subsidiary of Nautical;

(iv)       save for transactions solely between Nautical and its wholly-owned subsidiaries and other than pursuant to the Offer, agreed, authorised, proposed or announced its intention to propose any merger or demerger or acquisition or disposal of assets or shares (other than in the ordinary course of trading) or any material change in its share or loan capital;

(v)        save for transactions solely between Nautical and its wholly-owned subsidiaries, issued, authorised or proposed the issue of any debentures or incurred any indebtedness or contingent liability in each case which is material in the context of the Wider Nautical Group taken as a whole;

(vi)       acquired or disposed of or transferred, mortgaged or encumbered any asset or any right, title or interest in any asset (other than in the ordinary course of trading) and in each case which is material in the context of the Wider Nautical Group taken as a whole;

(vii)      entered into or varied or announced its intention to enter into or vary any contract, arrangement or commitment (whether in respect of capital expenditure or otherwise) which is of a long‑term (which shall mean for a fixed term in excess of 12 months and/or not terminable by the giving of 12 months' notice or less) or unusual nature or involves or could involve an obligation of an unusual nature or magnitude, and in each case which is material in the context of the Wider Nautical Group taken as a whole;

(viii)     entered into or proposed or announced its intention to enter into any reconstruction, amalgamation or arrangement (otherwise than in the ordinary course of business);

(ix)       made any amendment to its articles of association or other constitutional documents;

(x)        entered into any licence or other disposal of intellectual property rights of any such member which are material in the context of the Wider Nautical Group taken as a whole;

(xi)       taken any action nor having had any steps taken or legal proceedings started or threatened against it for its winding‑up or dissolution or for it to enter into any arrangement or composition for the benefit of its creditors, or for the appointment of a receiver, administrator, trustee or similar officer if it or of all or a material part of its assets (or any analogous proceedings or appointment in any overseas jurisdiction);

(xii)      been unable, or admitted in writing that it is unable, to pay its debts or having stopped or suspended (or threatened to stop or suspend) payment of its debts generally or ceased or threatened to cease carrying on all or a substantial part of its business;

(xiii)     entered into or varied or made any offer to enter into or vary the terms of any service agreement or arrangement with any of the Directors of Nautical;

(xiv)     proposed, agreed to provide or modified the terms of any share option scheme, incentive agreement, or other benefit relating to employment or termination of employment of any employee;

(xv)      waived, compromised or settled any claim which is material in the context of the Wider Nautical Group taken as a whole; or

(xvi)     entered into or made an offer (which remains open for acceptance) to enter into any agreement, arrangement or commitment or passed any resolution with respect to any of the transactions or events referred to in this condition;

(g)          except as Disclosed, since 30 June 2011 there having been, in each case to an extent which is material in the context of the Wider Nautical Group taken as a whole:

(i)         no adverse change, and no circumstances having arisen which might reasonably be expected to result in any adverse change, in the business, assets, financial or trading position or profits or prospects of any member of the Wider Nautical Group;

(ii)        no litigation, arbitration proceedings, prosecution or other legal proceedings having been instituted, announced or threatened by or against or remaining outstanding against any member of the Wider Nautical Group;

(iii)       no enquiry or investigation by or complaint or reference to any Relevant Authority against or in respect of any member of the Wider Nautical Group having been threatened, announced or instituted or remaining outstanding;

(iv)       no steps having been taken and no omissions having been made which would or might reasonably be expected to result in the withdrawal, cancellation, termination or adverse modification of any licence held by any member of the Wider Nautical Group which is necessary for the proper carrying on of its business where the withdrawal, cancellation, termination or modification of which would be likely to have an adverse effect; and

(v)        no contingent or other liability having arisen or been incurred otherwise than in the ordinary course of business which might reasonably be expected to adversely affect any member of the Nautical Group;

(h)          save as Disclosed, Capricorn not having discovered, in each case to an extent which is material in the context of the Wider Nautical Group taken as a whole, that:

(i)         the financial, business or other information concerning the Wider Nautical Group which has been disclosed at any time by or on behalf of any member of the Nautical Group whether publicly (by the delivery of an announcement to a Regulatory Information Service) or to Cairn or its professional advisers, either contains a material misrepresentation of fact or omits to state a fact necessary to make the information contained therein not misleading in any material respect; or

(ii)        any member of the Nautical Group is otherwise than in the ordinary course of its business subject to any liability, contingent or otherwise;

(iii)       any past or present member of the Wider Nautical Group has not complied in any material respect with all applicable legislation or regulations of any jurisdiction or any notice or requirement of any Relevant Authority with regard to the storage, disposal, discharge, spillage, leak or emission of any waste or hazardous substance or any substance likely to impair the environment or harm human health which non-compliance would be likely to give rise to any liability (whether actual or contingent) on the part of any member of the Wider Nautical Group;

(iv)       there has been a disposal, spillage, emission, discharge or leak of waste or hazardous substance or any substance likely to impair the environment or harm human health on, or from, any land or other asset now or previously owned, occupied or made use of by any past or present member of the Wider Nautical Group, or in which any such member may now or previously have had an interest, which would be likely to give rise to any liability (whether actual or contingent) on the part of any member of the Wider Nautical Group;

(v)        there is or is reasonably likely to be any obligation or liability (whether actual or contingent) to make good, repair, reinstate or clean up any property now or previously owned, occupied or made use of by any past or present member of the Wider Nautical Group or in which any such member may now or previously have had an interest under any environmental legislation or regulation or notice, circular or order of any Relevant Authority in any jurisdiction or to contribute to the cost thereof or associated therewith or to indemnify any person in relation thereto;

(vi)       circumstances exist (whether as a result of the Offer or otherwise) which would be reasonably likely to lead to any Relevant Authority instituting, or whereby any member of the Wider Cairn Group or the Wider Nautical Group would be likely to be required to institute, an environmental audit or take any other steps which would in any such case be reasonably likely to result in any liability (whether actual or contingent) to improve or modify existing or install new plant, machinery or equipment or carry out significant changes in the processes currently carried out or make good, remediate, repair, re-instate, decommission or clean up any land or other asset currently or previously owned, occupied, operated or made use of or controlled by any past or present member of the Wider Nautical Group (or on its behalf) or by any person for which a member of the Wider Nautical Group is or has been responsible, or in which any such member may have or previously have had an interest;

(i)                       save as Disclosed, Capricorn not having discovered that:

(i)         any member of the Wider Nautical Group or any person that performs services for or on behalf of the Wider Nautical Group in performing such services is or has at any time engaged in any activity, practice or conduct which would constitute an offence under the Bribery Act 2010 or any other applicable anti-corruption legislation; or

(ii)        any asset of any member of the Wider Nautical Group constitutes criminal property as defined in section 340(3) of the Proceeds of Crime Act 2002 (but disregarding paragraph (b) of that definition).

 

                                                                              

 



PART B

Certain further terms of the Offer

(a)          To the extent permitted by law and subject to the requirements of the Panel, Capricorn reserves the right in its sole discretion to waive, in whole or in part, all or any of Conditions in Part A above except for Condition 1. 

(b)          Subject to the requirements of the Panel, Capricorn reserves the right in its sole discretion to waive the deadline for the effectiveness of the Scheme.  If any such deadline is not met, Capricorn will make an announcement as soon as practicable and in any event by 8.00 a.m. on the Business Day following the date originally specified in Part A above.

(c)          Capricorn shall be under no obligation to waive (if capable of waiver), to determine to be or remain satisfied or to treat as fulfilled any of the Conditions 2(a) to 2(i) in Part A above by a date earlier than the latest date for the fulfilment of that condition notwithstanding that the other conditions of the Offer may at such earlier date have been waived or fulfilled and that there are at such earlier date no circumstances indicating that any of such conditions may not be capable of fulfilment. 

(d)          If Capricorn is required by the Panel to make an offer for Nautical Shares under the provisions of Rule 9 of the Code, Capricorn may make such alterations to the above conditions as are necessary to comply with the provisions of that Rule.

(e)          If a dividend and/or a distribution and/or a return of capital is proposed, declared, made, paid or becomes payable by Nautical in respect of a Nautical Share on or after the date of this announcement and prior to the Effective Date, Capricorn reserves the right to reduce the value of the consideration payable for each Nautical Share under the Offer in respect of any Nautical Share by up to the amount of the dividend and/or distribution and/or return of capital.

(f)           Capricorn reserves the right, with the consent of the Panel (if required), to elect to implement the Offer by way of a takeover offer under Part 28 of the Companies Act.  In such event, the Offer will be implemented on the same terms (subject to appropriate amendments as may be required by law or regulation), so far as applicable, as those which would apply to the Scheme.  In particular, Condition 1 will not apply and the Offer will include an acceptance condition at 90% (or such lesser percentage not being less than 50% as Capricorn may decide) of the Nautical shares to which the Offer relates.

(g)          Except with the consent of the Panel, the Scheme will not proceed if it is referred to the Competition Commission on or before the date on which the Court Meeting is to be held.

(h)          Under Rule 13.5(c) of the Code, Capricorn may not invoke any of the Conditions in paragraph 2 of Part A so as to cause the Offer not to proceed, to lapse or to be withdrawn unless the circumstances that give rise to the right to invoke the relevant Condition(s) are of material significance to Capricorn in the context of the Offer.  The Conditions 1 and 2(a) in Part A above and, if applicable, the acceptance condition referred to in paragraph (f) of this Part B are not subject to the provisions of the Code.

(i)           The availability of the Offer to persons not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions.  Persons who are not resident in the United Kingdom should inform themselves about and observe any applicable requirements.

(j)           The Offer will be governed by English law and be subject to the jurisdiction of the English Courts. The Offer will comply with the applicable rules and regulations of the Financial Services Authority, the London Stock Exchange, the Code and the AIM Rules for Companies.

(k)          The Offer will not be made, directly or indirectly, in, into or from, or by use of the mails of, or by any means or instrumentality (including, without limitation, telephonically or electronically) of interstate or foreign commerce of, or of any facilities of a national, state or other securities exchange of, any Restricted Jurisdiction and the Offer will not be capable of acceptance by any such use, means, instrumentality or facility or from within any Restricted Jurisdiction.

(l)           The Offer will be on and subject to the terms and the Conditions set out in this Appendix I, those terms which will be set out in the Scheme Document and such further terms as may be required to comply with the Code and other applicable law and regulation. Each condition shall be regarded as a separate condition and shall not be limited by reference to any other condition. This announcement does not constitute an offer or invitation to purchase Nautical Shares or any other securities.

 



APPENDIX II

SOURCES AND BASES

 

In this announcement:

 

1.   Unless otherwise stated:

·     financial information relating to the Nautical Group has been extracted or derived (without any adjustment) from the Nautical audited annual report and accounts for the year ended 30 June 2011 and the unaudited interim results for the six month period ended 31 December 2011;

·    financial information relating to the Cairn Group has been extracted or derived (without any adjustment) from the Cairn audited annual report and accounts for the year ended 31 December 2011; and

 

·     the value of the Offer based on the offer price of 450 pence per Nautical Share is calculated on the basis of the fully diluted number of Nautical Shares in issue referred to in paragraph 3 below.

 

2.   As at the close of business on 12 June 2012 (being the last Business Day prior to the Announcement Date), Nautical had in issue 87,745,179 Nautical Shares. The ISIN Number for Nautical Shares is GB00B3D2ND74.

 

3.   The fully diluted share capital of Nautical as at 12 June 2012 (being 92,022,679 Nautical Shares) is calculated on the basis of:

 

·     the number of Nautical Shares referred to in paragraph 2 above; and

·     any further Nautical Shares which may be issued on or after the Announcement Date on the exercise of in the money options under the Nautical Share Schemes, amounting in aggregate to 4,277,500 Nautical Shares.

 

4.   Unless otherwise stated, all prices and closing prices for Nautical Shares are closing quotations of a Nautical Share at the close of business on a particular trading day as derived from the Daily Official List published for that day.

 

5.   The premium calculations to the price per Nautical Share have been calculated by reference to:

 

·     a price of 297.8 pence per Nautical Share being the closing price on 12 June 2012, the Business Day immediately prior to the Announcement Date; and

·     the average closing price per Nautical Share of 309.8 pence over the three month period ended 12 June 2012, the Business Day immediately prior to the Announcement Date

 

in each case as provided by Bloomberg. 



 

APPENDIX III

IRREVOCABLE UNDERTAKINGS AND LETTERS OF INTENT

Part A - Nautical Directors

The following Nautical Directors have given irrevocable undertakings to vote in favour of the Scheme at the Court Meeting and the resolution to be proposed at the General Meeting in respect of their own beneficial holdings of issued and to be issued Nautical Shares as follows:

Name of Nautical Director

Number of Nautical Shares

Number of Nautical Shares under option

Percentage of Nautical issued share capital (excluding shares under option)

Steve Jenkins

908,096

1,425,000

1.03%

Paul Jennings

896,096

1,050,000

1.02%

Will Mathers

20,000

400,000

0.02%

Philip Dimmock

8,000

320,000

0.01%

Patrick Kennedy

83,000

320,000

0.09%

Total

1,915,192

3,515,000

2.18%

These irrevocable undertakings will remain binding in the event that a third party makes a competing offer and will only cease to be binding if (i) the Scheme Document (or offer document as applicable) is not published within 28 days of the date of this announcement (or such later date as Nautical and Capricorn may, with the consent of the Panel, agree), (ii) the Scheme does not become effective or lapses in accordance with its terms, or (iii) the Scheme is withdrawn or any competing offer is made which is declared wholly unconditional or otherwise becomes effective.

Part B - Institutional Nautical Shareholders

Capricorn has received an irrevocable undertaking from Anthony Lowrie ("AL") to vote in favour, or to procure the voting in favour, of the Scheme at the Court Meeting and the resolution to be proposed at the General Meeting in respect of an aggregate 2,585,933 Nautical Shares owned by AL and certain of his relatives and family trusts.  This undertaking will cease to be binding if (i) the Scheme Document (or offer document as applicable) is not published within 28 days of the date of this announcement (or such later date as the Panel may permit), (ii) the Scheme does not become effective or lapses in accordance with its terms, or (iii) the Scheme is withdrawn or any competing offer is made which is declared wholly unconditional or otherwise becomes effective.  This undertaking will be suspended if a higher competing offer (being an offer which is 5% per Nautical Share above the Offer Price) is made for the entire issued and to be issued share capital of Nautical, and will lapse if Capricorn does not then make a higher revised offer within 14 days of the date of the higher competing offer being made.

Capricorn has received an irrevocable undertaking from various funds and managed accounts managed by GLG Partners LP (the "GLG Funds") to procure the voting in favour of the Scheme at the Court Meeting and the resolution to be proposed at the General Meeting in respect of 3,303,318 Nautical Shares over which GLG holds long positions through contracts for differences to the extent GLG is able to direct the underlying holder so to vote. To the extent any GLG Fund is unable to so direct the underlying holder of Nautical Shares, it has agreed to instruct such underlying holder (provided neither party to the relevant contract for differences is prevented by its internal trading restrictions from doing so) to close out the contracts for differences in which event such GLG Fund will instead comply with the terms of the undertaking itself in relation to the relevant Nautical Shares. This undertaking will cease to be binding if (i) the Scheme Document (or offer document as applicable) is not published within 28 days of the date of this announcement (or such later date as the Panel may permit), (ii) the Scheme does not become effective or lapses in accordance with its terms, (iii) the Scheme is withdrawn or any competing offer is made which is declared wholly unconditional or otherwise becomes effective, or (iv) if a higher competing offer (being an offer which is 5% per Nautical Share above the Offer Price) is made for the entire issued and to be issued share capital of Nautical or a bona fide opportunity arises to sell the Nautical Shares or close out the relevant contracts for differences at a price exceeding at least 5% above the Offer Price.

Capricorn has received a letter of intent from Blackrock Investment Management (UK) Limited indicating its intention to vote (or procure the exercise of voting rights) in favour of the Scheme at the Court Meeting and the resolutions to be proposed at the General Meeting in respect of Nautical Shares the voting rights to which it is, at the record time for the Court Meeting and the General Meeting, able to control.  As at the close of business on 11 June 2012, Blackrock Investment Management (UK) Limited had the ability to control the voting rights in respect of 7,608,698 Nautical Shares.

Capricorn has received a letter of intent from SVM Asset Management Limited on behalf of funds and accounts indicating its intention to vote (or procure the exercise of voting rights) in favour of the Scheme at the Court Meeting and the resolutions to be proposed at the General Meeting in respect of 2,662,671 Nautical Shares.

Capricorn has received a letter of intent from MHR Institutional Partners II LP and MHR Institutional Partners IIA LP indicating its intention to vote (or procure the exercise of voting rights) in favour of the Scheme at the Court Meeting and the resolutions to be proposed at the General Meeting in respect of 5,838,947 Nautical Shares.

 



APPENDIX IV

DEFINITIONS

The following definitions apply throughout this document unless the context requires otherwise:

"Agora"

Agora Oil & Gas AS, a 100% subsidiary of Cairn

"AIM"

AIM, a market operated by the London Stock Exchange

"Announcement Date"

13 June 2012

"Authorisations"

regulatory authorisations, orders, recognitions, grants, consents, clearances, confirmations, certificates, licences, permissions or approvals

"Business Day"

any day (excluding any day which is a Saturday, Sunday or public holiday in England and Wales) on which banks in the City of London are open for general banking business

"bopd"

barrels of oil per day

"Cairn"

Cairn Energy PLC, a company incorporated in Scotland with registration number SC226712, and whose registered office is 50 Lothian Road, Edinburgh, EH3 9BY

"Cairn Directors" or "Cairn Board"

the directors of Cairn

"Cairn Group"

Cairn and its subsidiary undertakings

"Cairn India"

Cairn India Limited, incorporated in India

"Capricorn"

Capricorn Energy Limited, a private limited company incorporated in Scotland with registered number SC338010

"Capital Reduction"

the proposed reduction of Nautical's share capital provided for in the Scheme

"Code"

the City Code on Takeovers and Mergers

"Companies Act"

the Companies Act 2006

"Conditions"

the conditions to the implementation of the Offer as set out in Appendix I to this announcement and to be set out in the Scheme Document

"Court"

the High Court of Justice in England and Wales

"Court Meeting"

the meeting of Nautical Shareholders to be convened pursuant to an order of the Court under Part 26 of the Companies Act for the purpose of considering and, if thought fit, approving the Scheme (with or without amendment) including any adjournment thereof

"Court Order(s)"

the order(s) of the Court sanctioning the Scheme and confirming the Capital Reduction

"CREST"

a relevant system (as defined in the Regulations) in respect of which Euroclear UK & Ireland Limited is the Operator (as defined in the Regulations)

"Daily Official List"

the daily record setting out the prices of all trades in shares and other securities conducted on the London Stock Exchange

"Disclosed"

(i) publicly announced via a Regulatory Information Service by or on behalf of Nautical prior to the Announcement Date, (ii) disclosed in the annual report and accounts of Nautical for the financial year ended 30 June 2011, (iii) disclosed in the interim report of Nautical for the six months ended 31 December 2011 or (iv) as otherwise fairly disclosed by or on behalf of Nautical to Cairn or Capricorn or their advisers in connection with the Offer prior to the Announcement Date

"Effective Date"

the date on which the Scheme becomes effective in accordance with its terms

"Forms of Proxy"

the forms of proxy for the Court Meeting and the General Meeting

"General Meeting"

the general meeting of Nautical Shareholders to be convened in connection with the Scheme (including any adjournment thereof)

"Investec"

Investec Bank Plc, acting as Nautical's financial adviser, nominated adviser and joint broker

"Listing Rules"

the listing rules issued by the UK Listing Authority pursuant to Part VI of the Financial Services and Markets Act 2000

"London Stock Exchange"

London Stock Exchange plc

"Nautical"

Nautical Petroleum plc, a public limited company incorporated in England and Wales with registered number 04362104, and whose registered office is 6th Floor, 20 Berkeley Square, London, W1J 6EQ

"Nautical Directors" or "Nautical Board"

the directors of Nautical

"Nautical Group"

Nautical and its subsidiary undertakings

"Nautical Optionholders"

holders of Nautical Options

"Nautical Options"

subsisting options to acquire Nautical Shares granted in accordance with the Nautical Share Schemes

"Nautical Shareholders"

holders of Nautical Shares

"Nautical Shares"

 

the existing unconditionally allotted or issued and fully paid ordinary shares of 20 pence each in the capital of Nautical and any further such shares which are unconditionally allotted or issued and fully paid before the Scheme becomes effective in accordance with its terms

"Nautical Share Schemes"

the 2006 Nautical Petroleum plc Unapproved Share Option Scheme and the 2012 Nautical Petroleum plc Unapproved Share Option Scheme

"Offer"

the recommended cash offer to be governed by the Code and made by Capricorn to acquire the entire issued and to be issued share capital of Nautical to be effected by means of the Scheme and including, where the context so requires, any subsequent revision, variation, extension or renewal of such offer

"Offer Period"

the offer period (as defined in the Code) relating to Nautical which commenced on the Announcement Date

"Offer Price"

450 pence per Nautical Share

"Official List"

the official list maintained by the UK Listing Authority pursuant to Part VI of the Financial Services and Markets Act 2000

"Panel"

the Panel on Takeovers and Mergers

"RBC Capital Markets"

RBC Europe Limited, acting as joint broker to Nautical

"Relevant Authorities"

government or governmental, quasi‑governmental, supranational, statutory, administrative or regulatory body, authority, court, trade agency, association, institution, environmental body or any other similar person or body in any jurisdiction

"Regulations"

the Uncertificated Securities Regulations 2001 (SI 2011/3755) as amended

"Regulatory Information Service"

 

a Regulatory Information Service that is approved by the Financial Services Authority and is on the list maintained by the Financial Services Authority in LR App 3 to the Listing Rules

"Restricted Jurisdiction"

any jurisdiction where extension or acceptance of the Offer would violate the law or regulation of that jurisdiction

"Rothschild"

N M Rothschild & Sons Limited, acting as sole financial adviser to Cairn and Capricorn

"Scheme"

the scheme of arrangement under Part 26 of the Companies Act to be proposed by Nautical to the Nautical Shareholders in connection with the Offer with, or subject to, any amendment, modification, addition or condition thereto approved or imposed by the Court and agreed by Nautical and Capricorn

"Scheme Document"

the formal document to be sent to Nautical Shareholders containing, among other things, the Scheme, terms and conditions of the Offer and the notices convening the Court Meeting and General Meeting

"Scheme Record Voting Time"

the date and time specified in the Scheme Document by reference to which entitlement to vote at the Court Meeting will be determined

"Significant Interest"

in relation to an undertaking, a direct or indirect interest of 20% or more of the total voting rights conferred by the interests held in such undertaking

"subsidiary" and "subsidiary undertaking"

have the meanings given to them in sections 1159 and 1162 of the Companies Act

"UK" or "United Kingdom"

the United Kingdom of Great Britain and Northern Ireland

"UK Listing Authority"

the Financial Services Authority as the competent authority under Part VI of the Financial Services and Markets Act 2000

"United States"

the United States of America, its territories and possessions, any state of the United States of America, the District of Columbia, and all other areas subject to its jurisdiction

"£" or "Sterling"

pounds sterling, the lawful currency for the time being of the UK and references to "pence" and "p" shall be construed accordingly

"$" or "dollar"

United States dollars, the lawful currency for the time being of the United States

Unless otherwise stated, all times referred to in this announcement are references to the time in London.

Any reference to any provision of any legislation shall include any amendment, modification, re-enactment or extension thereof.

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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