On December 12, 2008, London-based international energy services company Hunting PLC announced the completion of its sale of Gibson Energy Holdings Inc. (Gibson) to Gibson Acquisition ULC, a company ultimately owned by the Riverstone/Carlyle Global Energy and Power Fund, an energy-focused private-equity fund managed by New York-based Riverstone Holdings LLC.
The total consideration for Gibson is $1,258 million, including $1,158 million in cash. Under the original terms of the transaction as announced to shareholders on August 6, 2008, the total consideration was payable in cash on completion. To assist the purchaser with its financing, Hunting has agreed to defer payment of $100 million of the consideration through the receipt of a warrant entitling Hunting to $100 million preferred equity shares in the parent company of the purchaser on exercise of the warrant. The preferred equity will carry an annual dividend, which is cumulative and compounding at a rate of 12 per cent. After two years the preferred equity automatically converts into a separate class of common shares. The value of the common shares will equal $100 million plus the amount of any accrued but unpaid dividends on the preferred equity at the date of conversion. The purchaser (or an affiliate of the purchaser) may purchase the warrant from Hunting for cash plus a sum equal to any cumulative dividends on the preferred equity from the date that the warrant has been issued.
The total consideration for Gibson is subject to a deduction for estimated debt within Gibson of $215 million as at completion and includes estimated net working capital in Gibson of $158 million at completion, estimates for which are subject to audit.
The amount of the debt financing facilities exceeded US$600 million, comprised of first lien and second lien bridge facilities and a senior asset-based loan facility. UBS Securities LLC or its affiliates acted as arranger, book manager, documentation agent and administrative agent in the first lien and second lien bridge facilities and co-lead arranger and documentation agent in the senior asset-based loan facility. RBC Capital Markets acted as co-lead arranger and collateral, administrative and syndication agent in the senior asset-based loan facility and co-lead arranger, co-book manager, Canadian administrative agent and collateral agent in the first lien and second lien bridge facilities. RBS Securities Corporation was co-lead arranger and co-book manager in the first lien and second lien bridge facilities.
Riverstone was represented in the transaction by Latham & Watkins LLP with a mergers and acquisitions team led by Washington, DC, partner James Hanna and counsel Joseph Simei, with the assistance of Nicholas Yunes. New York partner Marc Jaffe and Washington, DC, partner Patrick Shannon provided corporate finance advice, together with Alison Keith and Shagufa Hossain, and Washington, DC, partner James Ritter led the secured finance team, including Christopher Brown, Manu Gayatrinath, Scott Forchheimer and Steven Seem. Further advice was given by Latham & Watkins' New York and Washington, DC, offices by Cheryl Coe, Timothy George and Jill Sanchez (tax); David Della Rocca and Keith Ranta (employment and benefits); Barton Clark, Michael Chiswick-Patterson and Bobby Reddy (investment and strategic ventures); James Barrett and Anne Classen (environmental, land and resources) and Marc Williamson and Sydney Smith (antitrust). Riverstone's Canadian counsel was Bennett Jones LLP with a team led by Calgary partners Patrick Maguire and Tom McInerney and including John Mercury, Carolyn Simpson and Sandra Malcolm (commercial); Alan Rautenberg, Thomas Bauer, Anu Nijhawan and Steven Sieker (tax); Adam Kalbfleisch and Beth Riley (competition, Canadian regulatory); Carl Cunningham and Sean Maxwell (employment and pensions) and Duncan McPherson (environmental). Canadian aspects of the financing matters were led by Patrick Brennan with the support of Denise Bright, Andrew Lloyd, Jeff Heinbuch, Kieran Ryan and Jeremy Russell. Michael Chow assisted with real estate matters. In addition, Riverstone was represented by its managing director/general counsel Stephen Coats.
Hunting PLC and Gibson were represented in Canada by Fraser Milner Casgrain LLP with a team led by Calgary partner, Laura Safran, QC, and including Chima Nkemdirim, Dorothy Dawe, Vasiliki Antoniou and Bill Jenkins (mergers and acquisitions, securities); Anne Calverley, QC, Derek Kurrant, Jehad Haymour, Sebastian Elawny, Dan Misutka and Kevin Scott (tax); Edmonton partner Barry Zalmanowitz with the assistance of Matt Sudak (competition law, Canadian regulatory); and John Marner, Laura Zurowski, Bela Berze, Christina Winger and Rustam Juma (commercial). Additional assistance was provided by Michael Hurst and Miles Pittman (oil and gas); Will Cascadden (employment and labour); Jim Rose, QC, (litigation); Scott Sangster (corporate finance) and Lars Olthafer and Alex MacWillliam (Canadian oil and gas regulatory, environmental). Fraser Milner Casgrain LLP worked closely with Gibson's general counsel, Murray Carey, and senior counsel Sean Wilson. Cameron McKenna LLP advised Hunting in connection with UK matters with a team led by Gary Green and Darren Lennark. US regulatory law advice was provided by Dan Wellington and Kristin McGovern of the Washington, DC, office of Fulbright & Jaworski LLP. Paul, Weiss, Rifkind, Wharton & Garrison LLP partner Andrew Foley provided US securities law advice with the assistance of Peter Wright.
Ogilvy Renault LLP represented RBC Capital Markets in the transaction with a team including Kevin Morley, David Amato, James Padwick and Carla Machado.
UBS was represented in the transaction by Cahill Gordon & Reindel LLP with a team led by New York partner Rich Farley and including Timothy Howell, Michael Kazakevich, Jason Lee, Scott Selinger, Banks Bruce, Jay Shuman and William Holmes as well as Anastasia Efimova (secured financing), Athy Mobilia and Karen Meredith (real estate), Howard Adams and Jun Kang (tax) and Andrew Blau (employment). Canadian counsel for UBS was Stikeman Elliott LLP with a team led by Toronto partner Daphne MacKenzie and Calgary partner Michael Dyck, and including Jennifer Byun, Tess Lofsky, Mark Christensen and Scott Perrin (banking); Harold Andersen (energy); Dana Porter and Kim Newman (real estate); Greg Plater (environmental); John Lorito and Trevor McGowan (tax); Ralph Hipsher (securities); Andrea Boctor (pensions and benefits); Lorna Cuthbert and Lelia Costantini (employment); and Justine Whitehead (intellectual property).
The total consideration for Gibson is $1,258 million, including $1,158 million in cash. Under the original terms of the transaction as announced to shareholders on August 6, 2008, the total consideration was payable in cash on completion. To assist the purchaser with its financing, Hunting has agreed to defer payment of $100 million of the consideration through the receipt of a warrant entitling Hunting to $100 million preferred equity shares in the parent company of the purchaser on exercise of the warrant. The preferred equity will carry an annual dividend, which is cumulative and compounding at a rate of 12 per cent. After two years the preferred equity automatically converts into a separate class of common shares. The value of the common shares will equal $100 million plus the amount of any accrued but unpaid dividends on the preferred equity at the date of conversion. The purchaser (or an affiliate of the purchaser) may purchase the warrant from Hunting for cash plus a sum equal to any cumulative dividends on the preferred equity from the date that the warrant has been issued.
The total consideration for Gibson is subject to a deduction for estimated debt within Gibson of $215 million as at completion and includes estimated net working capital in Gibson of $158 million at completion, estimates for which are subject to audit.
The amount of the debt financing facilities exceeded US$600 million, comprised of first lien and second lien bridge facilities and a senior asset-based loan facility. UBS Securities LLC or its affiliates acted as arranger, book manager, documentation agent and administrative agent in the first lien and second lien bridge facilities and co-lead arranger and documentation agent in the senior asset-based loan facility. RBC Capital Markets acted as co-lead arranger and collateral, administrative and syndication agent in the senior asset-based loan facility and co-lead arranger, co-book manager, Canadian administrative agent and collateral agent in the first lien and second lien bridge facilities. RBS Securities Corporation was co-lead arranger and co-book manager in the first lien and second lien bridge facilities.
Riverstone was represented in the transaction by Latham & Watkins LLP with a mergers and acquisitions team led by Washington, DC, partner James Hanna and counsel Joseph Simei, with the assistance of Nicholas Yunes. New York partner Marc Jaffe and Washington, DC, partner Patrick Shannon provided corporate finance advice, together with Alison Keith and Shagufa Hossain, and Washington, DC, partner James Ritter led the secured finance team, including Christopher Brown, Manu Gayatrinath, Scott Forchheimer and Steven Seem. Further advice was given by Latham & Watkins' New York and Washington, DC, offices by Cheryl Coe, Timothy George and Jill Sanchez (tax); David Della Rocca and Keith Ranta (employment and benefits); Barton Clark, Michael Chiswick-Patterson and Bobby Reddy (investment and strategic ventures); James Barrett and Anne Classen (environmental, land and resources) and Marc Williamson and Sydney Smith (antitrust). Riverstone's Canadian counsel was Bennett Jones LLP with a team led by Calgary partners Patrick Maguire and Tom McInerney and including John Mercury, Carolyn Simpson and Sandra Malcolm (commercial); Alan Rautenberg, Thomas Bauer, Anu Nijhawan and Steven Sieker (tax); Adam Kalbfleisch and Beth Riley (competition, Canadian regulatory); Carl Cunningham and Sean Maxwell (employment and pensions) and Duncan McPherson (environmental). Canadian aspects of the financing matters were led by Patrick Brennan with the support of Denise Bright, Andrew Lloyd, Jeff Heinbuch, Kieran Ryan and Jeremy Russell. Michael Chow assisted with real estate matters. In addition, Riverstone was represented by its managing director/general counsel Stephen Coats.
Hunting PLC and Gibson were represented in Canada by Fraser Milner Casgrain LLP with a team led by Calgary partner, Laura Safran, QC, and including Chima Nkemdirim, Dorothy Dawe, Vasiliki Antoniou and Bill Jenkins (mergers and acquisitions, securities); Anne Calverley, QC, Derek Kurrant, Jehad Haymour, Sebastian Elawny, Dan Misutka and Kevin Scott (tax); Edmonton partner Barry Zalmanowitz with the assistance of Matt Sudak (competition law, Canadian regulatory); and John Marner, Laura Zurowski, Bela Berze, Christina Winger and Rustam Juma (commercial). Additional assistance was provided by Michael Hurst and Miles Pittman (oil and gas); Will Cascadden (employment and labour); Jim Rose, QC, (litigation); Scott Sangster (corporate finance) and Lars Olthafer and Alex MacWillliam (Canadian oil and gas regulatory, environmental). Fraser Milner Casgrain LLP worked closely with Gibson's general counsel, Murray Carey, and senior counsel Sean Wilson. Cameron McKenna LLP advised Hunting in connection with UK matters with a team led by Gary Green and Darren Lennark. US regulatory law advice was provided by Dan Wellington and Kristin McGovern of the Washington, DC, office of Fulbright & Jaworski LLP. Paul, Weiss, Rifkind, Wharton & Garrison LLP partner Andrew Foley provided US securities law advice with the assistance of Peter Wright.
Ogilvy Renault LLP represented RBC Capital Markets in the transaction with a team including Kevin Morley, David Amato, James Padwick and Carla Machado.
UBS was represented in the transaction by Cahill Gordon & Reindel LLP with a team led by New York partner Rich Farley and including Timothy Howell, Michael Kazakevich, Jason Lee, Scott Selinger, Banks Bruce, Jay Shuman and William Holmes as well as Anastasia Efimova (secured financing), Athy Mobilia and Karen Meredith (real estate), Howard Adams and Jun Kang (tax) and Andrew Blau (employment). Canadian counsel for UBS was Stikeman Elliott LLP with a team led by Toronto partner Daphne MacKenzie and Calgary partner Michael Dyck, and including Jennifer Byun, Tess Lofsky, Mark Christensen and Scott Perrin (banking); Harold Andersen (energy); Dana Porter and Kim Newman (real estate); Greg Plater (environmental); John Lorito and Trevor McGowan (tax); Ralph Hipsher (securities); Andrea Boctor (pensions and benefits); Lorna Cuthbert and Lelia Costantini (employment); and Justine Whitehead (intellectual property).
Lawyer(s)
Michael J. Chow
Jehad Haymour
Kieran F. Ryan
Lars Olthafer
Denise D. Bright
Thomas A. Bauer
T. Murray Carey
Andrew T. Lloyd
L. Alan Rautenberg
William K. Jenkins
Jeff Heinbuch
Daniel Misutka
Andrew J. Foley
John G. Lorito
David M.A. Amato
Rustam Juma
Adam Kalbfleisch
L. Greg Plater
Thomas W. McInerney
S. Sebastian Elawny
Michael Dyck
William E. Cascadden
Michael A. Hurst
Tess Lofsky
Lelia Costantini
Kevin J. Morley
Scott Perrin
Dana Porter
James F. Ritter
Anu Nijhawan
Ralph A. Hipsher
Bela G. Berze
Anne Calverley
Harold K. Andersen
Sean L. Maxwell
Scott W. Sangster
Matt Sudak
Alexander G. MacWilliam
Trevor McGowan
Jeremy A.J. Russell
Chima Nkemdirim
Y. Beth Riley
Mark Christensen
Patrick T. Maguire
Richard E. Farley
Kevin Scott
Miles F. Pittman
Sandra L. Malcolm
Patrick J. Brennan
Andrea Boctor
Jennifer Byun
Barry Zalmanowitz
Vasiliki Antoniou
Joseph A. Simei
Patrick H. Shannon
James W. Rose
Christina Winger
John P. Marner
John M. Mercury
Daphne J. MacKenzie
Sean M.A. Wilson
Carolyn E. Simpson
Lorna A. Cuthbert
James Padwick
Derek A. Kurrant
Laura J. Zurowski
Marc D. Jaffe
Cheryl M. Coe
Duncan M. McPherson
Firm(s)
Latham & Watkins LLP
Bennett Jones LLP
Dentons Canada LLP
CMS Cameron McKenna LLP
Fulbright & Jaworski LLP
Paul, Weiss, Rifkind, Wharton & Garrison LLP
Norton Rose Fulbright Canada LLP
Cahill Gordon & Reindel LLP
Stikeman Elliott LLP