09 Mar 2021
Sale of Cairn’s interests in the Catcher and Kraken Fields
Cairn is pleased to announce that it has entered into an agreement that will result in the sale of its interests in the UK Catcher and Kraken fields to Waldorf Production Limited (“Waldorf”) for a cash consideration of US$460 million plus additional contingent consideration dependent principally on oil prices from 2021 to the end of 2025. The consideration is subject to adjustments for working capital and other customary interim period adjustments from the economic effective date of 1 January 2020.
- Cairn to sell its entire 20 per cent interest in the Catcher field and 29.5 per cent interest in the Kraken field
- Firm consideration of US$460 million (to be adjusted for working capital and interim period adjustments from effective date of 1 January 2020)
- Additional uncapped contingent consideration dependent on oil prices and production performance from 2021 to the end of 2025: generating ~US$75 million at US$60 Brent and ~US$125 million at US$65 Brent (based on Cairn expected production profiles)
- Further strengthens Cairn’s balance sheet and provides flexibility to sustain and prolong the producing asset base
- Completion currently expected in H2 2021
Simon Thomson, Chief Executive of Cairn said:
“The divestment of our UK producing assets as they move into decline phase, will further strengthen our ability to pursue Cairn’s strategic goals and position the company robustly for the decade ahead.”
The disposal is a Class 1 transaction and subject to shareholder approval. Cairn will publish a circular to shareholders in due course setting out further details of the Transaction and convening the General Meeting, at which shareholder approval will be sought for the Transaction.
Rothschild & Co is acting as financial advisor and sponsor to Cairn in connection with the Transaction.
This summary should be read in conjunction with the full text of this announcement. Capitalised terms used in this announcement have the meanings given to them in the Appendix.
David Nisbet, Corporate Affairs
Tel: 0131 475 3000
Jonathan Milne, Linda Bain, Corporate Affairs
Tel: 0131 475 3000
Patrick Handley, David Litterick, Brunswick Group LLP
Tel: 0207 404 5959
There will be a live audio webcast available to view on the website (www.cairnenergy.com) at 9am GMT. This can be viewed on PC, Mac, iPad, iPhone and Android mobile devices.
An 'on demand' version of the webcast will be available on the website as soon as possible after the event. This can be viewed on PC, Mac, iPad, iPhone and Android mobile devices.
The presentation slides will be available on the website from 7:00am GMT.
You can listen to the presentation by dialling in to a listen only conference call at 9am GMT using the below dial-in details.
UK, local: +44 (0)330 336 9125
A transcript of the presentation will be available on the website as soon as possible after the event.
Notes to Editors
The information contained within this announcement is deemed by Cairn to constitute inside information as stipulated under UK MAR. By the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain. The person responsible for arranging for the release of this announcement on behalf of Cairn is Mr. James Smith, Chief Financial Officer.
For further information on Cairn please go to: www.cairnenergy.com
This announcement has been issued by and is the sole responsibility of Cairn. The information contained in this announcement is for information purposes only and does not purport to be complete. The information in this announcement is subject to change.
This announcement has been prepared in accordance with English law, UK MAR and the Disclosure Guidance and Transparency Rules and Listing Rules of the FCA and information disclosed may not be the same as that which would have been prepared in accordance with the laws of jurisdictions outside England.
N. M. Rothschild & Sons Limited (“Rothschild & Co”), which is authorised and regulated in the United Kingdom by the FCA, is acting exclusively for Cairn and for no-one else in connection with the contents of this announcement and the Transaction and will not regard any other person as its client in relation to the matters in this announcement and will not be responsible to anyone other than Cairn for providing the protections afforded to clients of Rothschild & Co nor for providing advice in connection with the contents of this announcement or the Transaction or any transaction, arrangement or other matter referred to in this announcement.
The contents of this announcement are not to be construed as legal, business or tax advice. Each Shareholder should consult its own legal adviser, financial adviser or tax adviser for legal, financial or tax advice respectively.
Cautionary Note Regarding Forward-looking Statements
This announcement includes certain forward-looking statements with respect to the financial condition, results of operations and business of the Group and certain plans and objectives of the Board. These forward-looking statements can be identified by the fact that they do not relate to any historical or current facts. Forward-looking statements often use words such as ''proposed'', ''anticipate'', ''expect'', ''estimate'', ''intend'', 'plan'', ''believe'', ''will'', ''may'', ''should'', ''would'', ''could'' or other words with a similar meaning. These statements are based on assumptions and assessments made by the Board in light of its experience and its perception of historical trends, current conditions, expected future developments and other factors it believes appropriate. By their nature, forward-looking statements involve risk and uncertainty and there are a number of factors that could cause actual results and developments to differ materially from those expressed in, or implied by, such forward-looking statements.
These forward-looking statements speak only as at the date of this announcement. Save as required by the requirements of the Listing Rules or the Disclosure Guidance and Transparency Rules of the FCA or otherwise arising as a matter of law or regulation, Cairn expressly disclaims any obligation or undertaking to disseminate after publication of this announcement any updates or revisions to any forward-looking statements contained herein to reflect any change in the Group's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.
Neither the content of Cairn's website (or any other website) nor the content of any website accessible from hyperlinks on Cairn's website (or any other website) is incorporated into or forms part of this announcement.
Unless otherwise indicated, all references in this announcement to all references to ''US dollars'', ''US$'' and ''US cents'' are to the lawful currency of the United States.
About Cairn Energy PLC
Cairn is one of Europe's leading independent energy companies and has been listed on the London Stock Exchange for 30 years. Cairn has explored, discovered, developed and produced oil and gas in a variety of locations throughout the world as an operator and partner in all stages of the oil and gas lifecycle.
Cairn’s exploration activities have a geographical focus in the North Sea, West Africa and Latin America, underpinned by interests in production and development assets. Cairn has its headquarters in Edinburgh, Scotland supported by operational offices in London and Mexico.
For further information on Cairn please see: www.cairnenergy.com