Subsea 7’s offer to acquire DOF’s entire issued share capital about to expire

Subsea 7’s offer to acquire the entire issued share capital of Norway’s DOF Group is expiring at the end of today, 19 June, after the rejection from DOF’s board.

Subsea 7 made a proposal on 15 June to the Board of Directors of DOF to acquire the entire issued share capital of the group, offering NOK 35 per share, comprised of NOK 7 in cash and NOK 28 in newly-issued shares in Subsea 7. As a result, DOF’s ownership of the pro-forma entity would be 11.5 per cent.

DOF’s board rejected the offer a day later, stating that it was below the equity valuation expectation of the board and its current shareholders.

Subsea 7 said it was guided in its offer by the pricing of the new share issue through an initial public offering at NOK 28 per share, as well as the pricing of shares allocated to the DOF Group chairman and directors at NOK 23 per share on 8 June.

According to the company, although major DOF shareholders had expressed support for the industrial rationale for the combination and the attractiveness of the Subsea 7 equity element of the offer, the board refused to engage on this offer.

Subsea 7 noted it was not prepared to amend its offer without the board of DOF Group expressing willingness to open a constructive dialogue.

“Subsea 7 reiterates its conviction in the strategic rationale, industrial logic and the attractiveness of Subsea 7 equity as part of the offer, which it believes is in the best interests of both companies’ shareholders,” Subsea 7 said.

Subsea 7 believes that the combined company would benefit from a substantial free float of approximately 80 per cent of the issued share capital, representing approximately NOK 39 billion of equity assuming current market prices and the offer.

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