AGR, First Geo to Merge

Maritime Activity Reports, Inc.

December 9, 2018

Pic: Akastor

Pic: Akastor

Norwegian offshore oil and gas consultancy and services companies First Geo (owned by Akastor), and AGR Bidco are set to merge.

"Akastor AS (Akastor), has entered into agreements with Silverfleet Capital, DNB Bank ASA and Nordea Bank Abp, filial i Norge (together the AGR stakeholders) to combine AGR Bidco AS (AGR) with First Geo AS," said a press statement.

The Transaction will be carried out primarily as an asset deal, whereby assets in the current AGR legal structure and three legal entities will, together with First Geo, be transferred to a new legal structure, which in turn will be transferred to Akastor to establish the merged company.

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.

On a consolidated basis, the merged company would have total year-to-date revenues of NOK 500 million, EBITDA of NOK 18 million and approximately 415 professionals as of September 2018.

Karl Erik Kjelstad, CEO of Akastor, said: "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 said: "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".

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.

AGR will be consolidated in to Akastor ASA's financial reporting post-closing.

DNB Markets, a part of DNB Bank ASA, and Nordea Bank Abp, filial i Norge, C&IB are acting as joint financial advisors to AGR in connection with the transaction. Advokatfirmaet Wiersholm AS are acting as legal advisors to DNB and Nordea and Advokatfirmaet BAHR are acting as legal advisors to Akastor.

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