NODL: Contemplated private placement
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO AUSTRALIA, CANADA, HONG KONG, JAPAN OR THE UNITED STATES, OR ANY OTHER JURISDICTION IN WHICH THE RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF ANY OF THE SECURITIES DESCRIBED HEREIN.
Reference is made to the stock exchange announcement made by Northern Drilling Ltd. (the “Company“) on 19 October 2023 regarding an update on the Company’s financing situation and its intention to appeal on a point of law and to challenge on grounds of serious irregularity the arbitration tribunal’s awards in the arbitration proceedings with Hanwha Ocean Co., Ltd. (together, the “Appeals Process“). In said announcement, the Company advised that it requires funds to pursue the Appeals Process. It was also announced that, as a general rule, there are limited grounds to appeal arbitration awards, and permission of the court will be required for an appeal on a point of law to be made.
The Company is hereby announcing that it is contemplating a private placement (the “Private Placement“) of new shares (the “Offer Shares“), raising gross proceeds of up to USD 3.5 million. The Private Placement is directed solely towards existing shareholders of the Company and subject to and in compliance with applicable exemptions from relevant prospectus or registration requirements. The Company has engaged SpareBank 1 Markets AS to act as its sole manager and bookrunner in the Private Placement (the “Manager“).
The net proceeds from the Private Placement will be used to partly fund costs associated with the Appeals Process. The Board is of the opinion that the Company will need more funding for the Appeals Process, and intends to raise such capital in several equity transactions, of which the Private Placement is the first. A court decision on the challenge on grounds of serious irregularity and on whether to grant permission to appeal on a point of law is, at this early stage, anticipated to be in the first quarter of 2024 and if permission to appeal on a point of law is granted, the final decision on the appeal is expected in the second or third quarter of 2024.
The subscription price will be set through an accelerated bookbuilding process. The application period for the Private Placement will start today, 24 October 2023 at 09:00 (CEST) and is expected to close no later than 25 October 2023 at 16:30 (CEST). The Company reserves the right to close or extend the application period at any time at its sole discretion, at short notice. The minimum order size and allocation in the Private Placement will be the NOK equivalent of EUR 100,000, provided that the Company may, at its sole discretion, offer and allocate an amount below EUR 100,000, pursuant to any applicable exemptions from applicable prospectus requirements being available.
The Company’s largest shareholder, Hemen Holding Ltd. (“Hemen“), is supportive of the transaction and intends to subscribe for at least its pro-rata shareholding of approx. 40.63%.
Allocation of Offer Shares will be made at the discretion of the Company’s Board of Directors in consultation with the Manager after expiry of the application period, subject to any shortening or extension of the application period.
The payment date and delivery date of the Offer Shares is expected to be on or about 9 November 2023, which is the date after the Company is scheduled to convene a Special General Meeting (“SGM“) resolving to reduce the par value of the Company’s shares from USD 1 to USD 0.01. Consequently, any Offer Shares will be issued with a par value of USD 0.01.
Completion of the Private Placement is conditional upon the necessary corporate resolutions being validly made by the Company, including without limitation approval by the Company’s Board of Directors, the Offer Shares having been fully paid and validly issued, and the approval by the SGM of the proposed reduction of the par value of the Company’s shares. The Company and the Manager reserve the right, at any time and for any reason, to cancel and/or modify the terms of the Private Placement.
Listing of the Offer Shares in the Private Placement will require a listing prospectus. Consequently, the Offer Shares will be registered under a separate ISIN pending approval and publication of a listing prospectus by the Norwegian Financial Supervisory Authority (the “NFSA“) and the Offer Shares will not be listed or tradable on Oslo Børs until such listing prospectus has been approved by the NFSA and been published by the Company.
The Company has considered the Private Placement in light of the equal treatment obligations under applicable regulations and is of the opinion that the waiver of the preferential rights inherent in a private placement, taking into consideration the time, costs and risk of alternative methods of the securing the desired funding, is in the common interest of the shareholders of the Company.
The Company may, subject to completion of the Private Placement, consider conducting a subsequent share offering of new shares (the “Subsequent Offering“). If carried out, the size and structure of the Subsequent Offering shall be in line with market practice. The Company reserves the right in its sole discretion to not conduct or cancel the Subsequent Offering.
This information is considered to be inside information pursuant to the EU Market Abuse Regulation and was published by Scott McReaken, CEO of the Company, on 24 October 2023 at 07:30 (CEST).
Contacts:
Scott McReaken, CEO
+1 (832) 509 7191
Additional information about the Company can be found at: http://www.northerndrillingltd.com/
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Important information:
This announcement is not and does not form a part of any offer to sell, or a solicitation of an offer to purchase, any securities of the Company. Copies of this announcement are not being made and may not be distributed or sent into any jurisdiction in which such distribution would be unlawful or would require registration or other measures.
The securities referred to in this announcement have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and accordingly may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and in accordance with applicable U.S. state securities laws. The Company does not intend to register any part of the offering in the United States or to conduct a public offering of securities in the United States. Any sale in the United States of the securities mentioned in this announcement will be made solely to “qualified institutional buyers” as defined in Rule 144A under the Securities Act.
In any EEA Member State, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Regulation, i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State. The “Prospectus Regulation” means Regulation (EU) 2017/1129, as amended (together with any applicable implementing measures) in any Member State.
This communication is only being distributed to and is only directed at persons in the United Kingdom that are (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Order”) or (ii) high net worth entities, and other persons to whom this announcement may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”). This communication must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this communication relates is available only for relevant persons and will be engaged in only with relevant persons. Persons distributing this communication must satisfy themselves that it is lawful to do so.
The issue, subscription or purchase of shares in the Company is subject to specific legal or regulatory restrictions in certain jurisdictions. Neither the Company nor the Manager assume any responsibility in the event there is a violation by any person of such restrictions. The distribution of this release may in certain jurisdictions be restricted by law. Persons into whose possession this release comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. Matters discussed in this announcement may constitute forward-looking statements. Forward-looking statements are statements that are not historical facts and may be identified by words such as “believe”, “expect”, “anticipate”, “strategy”, “intends”, “estimate”, “will”, “may”, “continue”, “should” and similar expressions. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believe that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict, and are beyond their control. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. The Company does not make any guarantee that the assumptions underlying the forward-looking statements in this announcement are free from errors nor does it accept any responsibility for the future accuracy of the opinions expressed in this announcement or any obligation to update or revise the statements in this announcement to reflect subsequent events. You should not place undue reliance on the forward-looking statements in this announcement. The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice. The Company does not undertake any obligation to review, update, confirm, or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this announcement. This announcement is for information purposes only and is not to be relied upon in substitution for the exercise of independent judgment. It is not intended as investment advice and under no circumstances is it to be used or considered as an offer to sell, or a solicitation of an offer to buy any securities or a recommendation to buy or sell any securities of the Company. The distribution of this announcement and other information may be restricted by law in certain jurisdictions. Persons into whose possession this announcement or such other information should come are required to inform themselves about and to observe any such restrictions. This announcement is an advertisement and is not a prospectus for the purposes of the Prospectus Regulation as implemented in any Member State.