The Netherlands: CGGVeritas to Acquire Funds for Geoscience Division Acquisition

Compagnie Générale de Géophysique – Veritas (CGGVeritas) announced on 24 September 2012 that it had entered into an agreement with the Dutch group Fugro to acquire the businesses of its Geoscience division (excluding multi-clients library and OBN businesses) (the “Geoscience Division”) for a price of 1.2 billion euros and establish a joint venture specialising in ocean bottom seismic data acquisition (the “Seabed Joint Venture”).

To fund such acquisition, CGGVeritas launches today a capital increase via an offering of preferential subscription rights to existing shareholders for a gross amount of approximately €414 million1.

The net proceeds of the issuance will be used to pay a portion of the acquisition price for the Geoscience Division (the “Acquisition”). The remainder of the Acquisition price will be paid by way of set-off of €225 million from Fugro representing the excess value of CGGVeritas contribution to the Seabed Joint Venture and paid with the proceeds of debt financing, in the form of convertible or non-convertible bond issuances and/or bank loans (CGGVeritas benefits from a bridge credit facility commitment of up to €700 million).

The completion of the Acquisition is subject to certain customary conditions precedent for this type of transaction, in particular the approval of competition authorities, and the signing of the agreement establishing the Seabed Joint Venture.

If the Acquisition is not achieved, in particular if the relevant conditions precedent are not satisfied, the net proceeds of the issue will be allocated to the repayment of the Group’s existing debt.

Each shareholder of CGGVeritas will receive one preferential subscription right for every share it holds as of the close of trading on 27 September 2012. The subscription price for the new shares has been set at 17 euros per share (nominal value of €0.40 and issue premium of €16.60) on the basis of 4 new shares for 25 existing shares. The subscription price represents a 33.07% discount to the closing price of the Company’s shares on 25 September 2012 and a 29.87% discount to the theoretical ex-right price (TERP).

The Fonds Stratégique d’Investissement, which holds 6.49% of CGGVeritas’ share capital, has undertaken to subscribe to this share capital increase, on an irreducible basis, for all of the preferential subscription attached to its shares and all of the preferential subscription rights from IFP Energies Nouvelles, that the Fonds Stratégique d’Investissement is committed to acquire.

IFP Energies Nouvelles, which holds 4.18% of the CGGVeritas’ share capital, has indicated to CGGVeritas its intention not to subscribe to the capital increase. However, IFP Energies Nouvelles is committed to sell to the Fonds Stratégique d’Investissement, with which it is acting in concert, all of the subscription rights it is entitled to.

The subscription period for the new shares will run from 28 September 2012 to the close of trading on 12 October 2012. During this period, the preferential subscription rights will be listed and traded on the regulated market of NYSE Euronext in Paris. The Record Date to be entitled to the preferential subscription rights is 27 September 2012.

Settlement and delivery and start of trading on Euronext Paris (Segment A) of the new shares will take place on 23 October 2012. The new shares, which will carry dividend rights as of 1 January 2012 and will entitle their holders to any dividends declared by the Company from the date of issue, will be fully fungible with the Company’s existing shares and will be traded under the same ISIN code as the Company’s existing shares.


Press Release, September 26, 2012

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