Eurasia Drilling approves equity stake for Schlumberger
MOSCOW. Feb 16 (Interfax) - Shareholders in oilfield services group Eurasia Drilling Company approved at an extraordinary meeting on February 16 acquisition by Schlumberger of almost 46% of shares in the company with the option to consolidate 100% of shares after 2018.
"A quorum of shareholders was present (in person or by proxy). The special resolution was approved," Eurasia Drilling said in a statement. The shareholders voted to approve the deal, in line with management's recommendation.
The shareholders approved merger of Eurasia Drilling with the newly created EDC Acquisition Company Limited, which will buy up shares from minority shareholders at $22 per share. The Schlumberger deal will not be closed until the Federal Anti-Monopoly Service (FAS) gives its clearance.
In order to approve sale of a 46% stake, two-thirds of Eurasia Drilling shareholders needed to vote in favor.
Schlumberger announced plans on January 20 to buy 46% of shares in Eurasia Drilling, which has a 20% share of Russia's drilling market.
If approved, Eurasia Drilling shares will be delisted from the London Stock Exchange on February 23, after which Eurasia Drilling's biggest shareholder will buy up minority stakes. Those purchases will be made using money borrowed from Schlumberger, to be repaid with Eurasia Drilling shares. In all Schlumberger will receive about 31% of Eurasia Drilling shares currently in free float and purchase another 15% of shares from the remaining shareholders.
At the same time it consolidates the 46% stake in Q1 2015, Schlumberger will receive an option to consolidate 100% of Eurasia Drilling shares. It may not exercise that option before 2018.
Schlumberger filed documents with the FAS, at the regulator's request, on February 10. The FAS has 30 days to study them.
Eurasia Drilling and Schlumberger may proceed with the deal while the FAS examination is underway. However, if the FAS subsequently identifies any violations, it will go to court to annul the deal.
Eurasia Drilling said previously that FAS clearance was not needed to close the deal.
Eurasia Drilling's biggest shareholder currently is company founder and head Alexander Japardidze with 30.2% and his business partner, former Rosneft president Alexander Putilov. They do not plan to sell their stakes for now.