PGS has rejected an offer from TGS-NOPEC Geophysical Company whereby TGS proposed to acquire multi-client data library of PGS.
PGS board of directors is of the view that the value of the company’s multi-client data library is significantly greater to PGS than that represented by the TGS proposal, and that the timing of the proposal is opportunistic given the current market backdrop and macro-economic environment.
Under the TGS offer, PGS would, upon consummation of the sale, receive a cash consideration of USD 600 million.
Furthermore, TGS proposed that the parties enter into a post-closing collaboration agreement for future PGS multi-client projects, which also would include certain preferential rights for PGS to offer its 3D fleet for future TGS data acquisition.
Having consulted with its financial and legal advisers, PGS has concluded that the proposal is not in the best interests of the company and its stakeholders.
Upon rejection of the offer, CEO of TGS, Kristian Johansen, said: “We believe a consolidation and further partnership between our two companies carry strong industry logic and we have seen broad support for this following our announcement last week. We are disappointed by the unwillingness from the PGS board and management to enter into discussions to explore joint opportunities and collaboration as indicated in our offer. TGS remains committed to our strategy of industry leadership and further consolidation to deliver best in class services to our customers, while creating value for our owners and other stakeholders.”