AGR, First Geo to merge into Akastor-owned company

Norwegian offshore oil and gas consultancy and services companies First Geo (owned by Akastor), and AGR are set to merge. The merged entity will be owned by Akastor.

In a stock exchange announcement on Friday, Akastor said it had agreed with AGR stakeholders to combing AGR and First Geo into a “leading provider of well, reservoir, and software services”

The merged company will be named AGR. Akastor will hold 100% of the shares in the company and 55% of the economic interest.

The AGR stakeholders will own the remaining 45% economic interest (economic interest regulated in equity participation agreement between the AGR stakeholders and Akastor). In addition, the merged company will roll over NOK 270 million of the debt of which DNB, Nordea, and Akastor will hold NOK 90 million each.

Karl Erik Kjelstad, CEO of Akastor, says: “I am pleased that Akastor continues to find industrial transactions that visualize the value in our portfolio. With First Geo as our contribution, we have created a new global company to build on in the years to come”.

The merged company will be led by Svein Sollund, current CEO of AGR, who says: “Changing market dynamics and pressure on margins enforce a fundamental change in how we manage our business. We are excited to have found such a good match in First Geo, enabling us to provide an even broader and deeper service offering to our clients”. Current Managing Director of First Geo,

Helge Hedman Nyrønning, will take on a new leading role in the merged company, and says: “I look forward to working with our new colleagues in AGR and to providing first class services to our clients through a new strong platform”.

Closing of the Transaction is subject to approval from Norwegian competition authorities, and certain other customary conditions. Closing is expected to take place at the end of 1Q 2019.