RAK Petroleum to launch initial public offering in Norway

RAK Petroleum PCL, the UAE oil and gas investment company, today announced that it is proceeding with plans for an initial public offering and application for listing in Norway. Prior to the listing, RAK Petroleum PCL will transfer substantially all of its assets, liabilities and business to a new UK company, RAK Petroleum plc, as part of a reorganisation approved by the shareholders in May 2013. RAK Petroleum plc will be the listing entity with shareholders of RAK Petroleum PCL receiving shares in the new entity pro rata to their current shareholding.

Subject to approval of the listing application and successful completion of the offering, the shares of RAK Petroleum plc are expected to commence trading on Oslo Børs, alternatively Oslo Axess (OSE ticker code: “RAKP”) on 7 November 2014.

The existing shareholders of RAK Petroleum PCL will be allotted restricted shares and an associated number of founder shares in RAK Petroleum plc corresponding to 90 percent of their shareholding in RAK Petroleum PCL, with the remaining 10 percent to be allotted in unrestricted shares. The unrestricted shares will be freely tradable but the restricted shares are subject to lockup for six months following the listing (other than to certain permitted transferees or with the Joint Lead Managers’ consent).

The size of the offering is approximately NOK 20 million and it is expected that up to 1,602,564 new shares will be issued under the offering (up to 0.5 percent of the total shares outstanding post listing).

Shares will be offered only to the retail market in Norway commencing on 28 October 2014. The offer price range has been set between NOK 12.48 and NOK 15.25.  The final offer price will be determined based on the market value of RAK Petroleum plc’s holding of shares in DNO ASA less a 35 percent discount which is offered to ensure sufficient retail interest and a successful listing on Oslo Børs, alternatively Oslo Axess.

“Given market conditions that have severely depressed share prices in the oil and gas sector, we limited the size of the offering to the minimum necessary to attract sufficient numbers of Norwegian shareholders to allow us to proceed with the listing,” said Bijan Mossavar-Rahmani, RAK Petroleum PCL’s Chairman of the Board of Directors and Chief Executive Officer. “Once listed, as markets recover we expect to have the flexibility to launch more meaningful offerings at prices that more accurately reflect our underlying assets and our growth prospects,” he added. 

“In the meantime, we expect that a few hundred Norwegian investors will pick up our shares at very attractive discounts and that’s fine, too,” Mr. Mossavar-Rahmani said.

Completion of the offering is conditional upon the board of directors of Oslo Børs approving the listing application and the satisfaction of the conditions for admission to trading, including (a) attracting in excess of 500 shareholders with Norwegian VPS accounts or 100 shareholders in the case of a listing on Oslo Axess, each holding shares with a value of more than NOK 10,000 and (b) reaching a minimum free float of the shares of 25 percent. Further, completion of the offering is conditional upon RAK Petroleum plc, in consultation with the Joint Lead Managers, having approved the offer price and the allocation of offer shares to eligible investors following the application period.

The Financial Supervisory Authority of Norway has approved the prospectus prepared in connection with the offering and listing.

ABG Sundal Collier Norge ASA (Global Coordinator) and DNB Markets are acting as Joint Lead Managers for the offering.