BP and Aker said Wednesday there were exploring a potential block sale of some of the shares they hold in the Norwegian oil and gas producer Aker BP ASA, through a private placement.
Aker and BP currently control approximately 40% and 30% of the shares outstanding in Aker BP. The two are contemplating selling shares representing approximately a total of 5% of Aker BP shares through an accelerated book-building process.
The sale would be split in proportion with the sellers’ current respective holdings, with BP selling shares representing approximately 2.1% of Aker BP’s outstanding shares and Aker selling shares representing approximately 2.9%. If the sale is completed, the free float in Aker BP will increase from 30% to 35%.
Following the completion of a sale, BP and Aker will enter into a six-month lock-up for the shares they currently hold in Aker BP that are not sold as part of the sale, subject to certain exemptions.
"Since the creation of Aker BP in 2016, it has pursued a successful organic and inorganic growth strategy offering attractive shareholder distributions and value creation combined with an investment grade-rated balance sheet. Aker BP is a pure-play oil and gas company with industry-leading low emissions and low-cost operations enabled by digitalization. The company has strong production growth, a robust balance sheet and delivers attractive returns," BP said.
Bernard Looney, BP chief executive said: “Aker BP has established itself as an undoubted Norwegian success story, with its value increasing significantly over the past five years. This transaction will enable BP to realize some of the considerable value Aker BP has already generated while remaining committed to its ongoing success and value creation for shareholders. Consistent with our long-standing track-record of active portfolio management, these divestment proceeds will be expected to further strengthen BP's balance sheet and support our ongoing buyback commitment.”
Øyvind Eriksen, President and CEO of Aker ASA, said: “Aker has a large portfolio with a variety of investments across different sectors whereas Aker BP represented 50% of Aker’s gross asset value per 3Q 2021. Aker BP is, and will remain, a core holding in Aker’s portfolio. The aim of the offering is however to balance Aker’s portfolio by freeing up liquidity, diversifying, and continue growing the portfolio. If the Offering is completed, Aker BP will remain the largest investment in Aker’s portfolio and Aker will remain the largest shareholder in Aker BP.”
BP said that proceeds from the transaction would form part of its target of delivering $25 billion of divestment and other proceeds by 2025. BP announced at the time of its third-quarter 2021 results that it expects $6-7 billion of divestment and other proceeds in 2021.
BP and Aker have retained J.P. Morgan AG and Pareto Securities AS as Joint Global Coordinators and Joint Bookrunners to explore the potential block sale of shares in Aker BP ASA through a private placement.
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