BW Offshore: BW Energy Limited- Announcement of Terms for the Initial Public Offering

NOT FOR DISTRIBUTION OR RELEASE, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES OF AMERICA AND THE DISTRICT OF COLUMBIA) (THE "UNITED STATES"), AUSTRALIA, CANADA, THE HONG KONG SPECIAL ADMINISTRATIVE REGION OF THE PEOPLE'S REPUBLIC OF CHINA OR JAPAN, OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL.

BW ENERGY LIMITED: ANNOUNCEMENT OF TERMS FOR THE INITIAL PUBLIC OFFERING

29 January 2020

Reference is made to the announcement by BW Offshore Limited ("BW Offshore") on 15 January 2020 regarding the intention to list the shares (the "Shares") of BW Energy Limited ("BW Energy" or the "Company", OSE ticker code "BWE") on the Oslo Stock Exchange and the contemplated initial public offering (the "IPO" or the "Offering").

The Offering
The Offer Shares (as defined below) are expected to be sold at a price between NOK 34.20 and NOK 36.60 per Offer Share, corresponding to a pre-money equity value of BW Energy of between NOK 6,409 million and NOK 6,867 million (approximately USD 700 million to USD 750 million). The final price per Offer Share may, however, be set above or below this indicative price range.

The Offering comprises of up to 46,849,342 new Shares to be issued by the Company (the "Offer Shares"), raising gross proceeds of approximately NOK 1,602 million (approximately USD 175 million). In addition, the Joint Global Coordinators (as defined below) may elect to over-allot a number of additional shares equalling up to 15% of the final number of Offer Shares sold in the Offering (the "Additional Shares"). In this respect, BW Offshore is expected to grant to Pareto Securities AS (the "Stabilisation Manager"), on behalf of the Managers (as defined below), an option to borrow a number of Shares equal to the number of Additional Shares in order to facilitate such over-allotment (the "Borrowing Option"). The Stabilisation Manager, on behalf of the Managers, is expected to be granted an option by the Company to purchase a number of new Shares equal to the number of Additional Shares at the final offer price in the IPO (the "Greenshoe Option"). The Greenshoe Option may be exercised, in whole or in part, within a 30-day period commencing at the time at which trading in the Shares commences on the Oslo Stock Exchange.

It is expected that the free float of the Company's shares following completion of the Offering and the BW Offshore Dividend Distribution (as defined below), will be in the range between approximately 24.2% and 25.6% of the shares in the Company, depending on the final Offer Price and the number of Shares distributed in the BW Offshore Dividend Distribution, and assuming that the Greenshoe Option is not exercised. If the Greenshoe Option is exercised in full, the free float is expected to be in the range between approximately 26.3% and 27.7%.

The Company, BW Offshore, BW Group Limited and the members of the Company's executive management and board of directors are expected to enter into customary lock-up undertakings with the Managers, which will restrict their ability to issue, sell, pledge or dispose of shares in the Company, for a period up to and including the date falling 12 months from the first day of trading of the Company's shares on the Oslo Stock Exchange.

Offering details
The Offering comprise of:

  • an "Institutional Offering", in which Offer Shares are being offered to (a) investors in Norway, (b) investors outside Norway and the United States, subject to applicable exemptions from the prospectus requirements, and (c) investors in the United States who are QIBs in transactions exempt from registration requirements under the U.S. Securities Act. The Institutional Offering is subject to a lower limit per application of NOK 2,000,000.
  • a  "Retail Offering", in which Offer Shares are being offered to the public in Norway subject to a lower limit per application of NOK 10,500 and an upper limit per application of NOK 1,999,999 for each investor. Investors who intend to place an order in excess of NOK 1,999,999 must do so in the Institutional Offering. Multiple applications  by one applicant in the Retail Offering will be treated as one application with respect to the maximum application limit. In addition to the public in Norway, directors of the Company and employees of the BW Energy group may apply for Offer Shares in the Retail Offering.

Prospectus

The further details of the Offering and the terms thereof are set out in the prospectus prepared by the Company in connection with the Offering which is expected to be approved by the Norwegian Financial Supervisory Authority later today and to be published tomorrow, 30 January 2020 at 08:00 hours (CET) (the "Prospectus"). The Prospectus will, subject to regulatory restrictions in certain jurisdictions, be available at www.bwenergy.no, www.dnb.no/emisjoner, www.paretosec.com/transactions, https://www.arctic.com/secno/en/offerings, www.danskebank.no/bwe and www.swedbank.no/store-foretak-og-institusjoner/advisory-services-and-investment-banking/corporate-finance/aktuelle-transaksjoner following publication. Copies of the Prospectus may be obtained free of charge at BW Energy's offices at 30 Pasir Panjang Road, #14-31/32 Mapletree Business City, Singapore 117440 or by contacting one of the Joint Global Coordinators.

Timeline and offer period
The bookbuilding period for the Institutional Offering is expected to take place from 30 January 2020 at 09:00 hours (CET) to 7 February 2020 at 14:00 hours (CET). The application period for the Retail Offering is expected to take place from 30 January 2020 at 09:00 hours (CET) to 7 February 2020 at 12:00 hours (CET). The Company, in consultation with the Joint Global Coordinators, reserves the right to shorten or extend the bookbuilding period and/or the application period at any time at its sole discretion. Any shortening of the bookbuilding period and/or the application period will be announced through the Oslo Stock Exchange's information system on or before 09:00 hours (CET) on the prevailing expiration date of the bookbuilding period and/or the application period, provided, however, that in no event will the bookbuilding period and/or the application period be shortened to expire prior to 16:30 hours (CET) on 6 February 2020. Any extension of the bookbuilding period and/or the application period will be announced through the Oslo Stock Exchange's information system on or before 09:00 hours (CET) on the first business day following the then prevailing expiration date of the bookbuilding period and/or the application period. An extension of the bookbuilding period and/or the application period can be made one or several times provided, however, that in no event will the bookbuilding period and/or the application period be extended beyond 16:30 hours (CET) on 24 February 2020. In the event of a shortening or an extension of the bookbuilding period and/or the application period, the allocation date, the payment due dates and the dates of delivery of Offer Shares will be changed accordingly, but the date of the listing and commencement of trading on the Oslo Stock Exchange may not necessarily be changed.

Distribution of BWE Shares by BW Offshore
In order to facilitate the free float of Shares required for the Listing, BW Offshore will distribute a number of Shares in BW Energy as dividend in kind to its shareholders (the "BW Offshore Dividend Distribution"). BW Offshore will determine the amount of the dividend distribution and the number of Shares to be distributed (the "Dividend Shares") when the final Offer Price has been determined following the expiry of the bookbuilding period for the Offering. The value of the Dividend Shares, based on the final Offer Price, is expected to be approximately USD 100 million. It is expected that the last day the BW Offshore shares will trade inclusive the right to Dividend Shares will be the last day in the bookbuilding period for the Offering, which is expected to be on or around 7 February 2020. The BW Offshore Dividend Distribution is conditional upon satisfaction of the other conditions for completion of the Offering set out below.

Conditions for the Offering
Completion of the Offering is conditional upon the board of directors of the Oslo Stock Exchange approving the application for listing in its meeting to be held on or about 6 February 2020 and the satisfaction of the conditions for admission to trading set by the Oslo Stock Exchange, which are expected to be that (a) BW Energy will have in excess of 500 shareholders, each holding Shares with a value more than NOK 10,000 and (b) the Company satisfying the minimum free float requirement set by Oslo Børs. Oslo Børs has indicated to the Company that an exemption from the 25% free float requirement will be granted for a period of 18 months from the first day of trading, provided that the free float at the first day of trading is at least 22%.

Completion of the Offering is otherwise conditional upon (i) the Company, in consultation with the Joint Global Coordinators, resolving to proceed with the Offering, (ii) the Company, in consultation with the Joint Global Coordinators, having approved the final Offer Price and the allocation of the Offer Shares to eligible investors following the bookbuilding process and (iii) BW Offshore having finally resolved the BW Offshore Dividend Distribution. There can be no assurance that these conditions will be satisfied. If the conditions are not satisfied, the Offering may be revoked or suspended by the Company.

Advisors
DNB Markets, a part of DNB Bank ASA and Pareto Securities AS are acting as joint global coordinators and joint bookrunners in the Offering (the "Joint Global Coordinators"). Arctic Securities AS, Danske Bank, Norwegian Branch, Nordea Bank Abp filial i Norge and Swedbank AB (publ) (in cooperation with Kepler Cheuvreux) are acting as co-managers (the "Co-Managers", and together with the Joint Global Coordinators, the "Managers").

Advokatfirmaet Thommessen AS is acting as Norwegian legal counsel to the Company, whilst Conyers Dill & Pearman Limited is acting as special Bermuda legal counsel to the Company. Advokatfirmaet Schjødt AS is acting as Norwegian legal counsel to the Managers.

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For further information, please contact:

Knut Sæthre, CFO BW Energy
+47 91 11 78 76
ir@bwenergy.no

About BW Energy

BW Energy is a growth E&P company with a differentiated strategy targeting proven offshore oil and gas reservoirs through low risk phased developments. The Company has access to existing FPSOs to reduce time to first oil and cash-flow with lower investments than traditional offshore developments. The main assets are 73.5% of the producing Dussafu Marine Permit offshore Gabon and a 95% interest in the Maromba field in Brazil, both operated by the Company. Total net 2P+2C reserves are 247 million barrels at the start of 2020 and gross average production from Dussafu was 11,779 bbl/day in 2019.

Not for distribution in or into the United States, Australia, Canada, the Hong Kong Special Administrative Region of the People's Republic of China or Japan.

Important notice

These materials do not constitute or form a part of any offer of securities for sale or a solicitation of an offer to purchase securities of the Company in the United States or any other jurisdiction. The securities of the Company may not be offered or sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act"). The securities of the Company have not been, and will not be, registered under the U.S. Securities Act. Any sale in the United States of the securities mentioned in this communication will be made solely to "qualified institutional buyers" as defined in Rule 144A under the U.S. Securities Act. No public offering of the securities will be made in the United States.

In any EEA Member State, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the EU Prospectus Regulation, i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State. The expression "EU Prospectus Regulation" means Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 (together with any applicable implementing measures in any Member State).

In the United Kingdom, this communication is only addressed to and is only directed at Qualified Investors who (i) are investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the "Order") or (ii) are persons falling within Article 49(2)(a) to (d) of the Order (high net worth companies, unincorporated associations, etc.) (all such persons together being referred to as "Relevant Persons"). These materials are directed only at Relevant Persons and must not be acted on or relied on by persons who are not Relevant Persons. Any investment or investment activity to which this announcement relates is available only to Relevant Persons and will be engaged in only with Relevant Persons. Persons distributing this communication must satisfy themselves that it is lawful to do so.

The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Transaction.

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Company's shares.

Each distributor is responsible for undertaking its own Target Market Assessment in respect of the Company's shares and determining appropriate distribution channels.

Matters discussed in this announcement may constitute forward-looking statements. Forward-looking statements are statements that are not historical facts and may be identified by words such as "anticipate", "believe", "continue", "estimate", "expect", "intends", "may", "should", "will" and similar expressions. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict and are beyond its control. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice.

This announcement is made by and, and is the responsibility of, the Company. The Managers are acting exclusively for the Company and no one else and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients, or for advice in relation to the contents of this announcement or any of the matters referred to herein.

Neither the Managers nor any of their respective affiliates makes any representation as to the accuracy or completeness of this announcement and none of them accepts any responsibility for the contents of this announcement or any matters referred to herein.

This announcement is for information purposes only and is not to be relied upon in substitution for the exercise of independent judgment. It is not intended as investment advice and under no circumstances is it to be used or considered as an offer to sell, or a solicitation of an offer to buy any securities or a recommendation to buy or sell any securities of the Company. Neither the Managers nor any of their respective affiliates accepts any liability arising from the use of this announcement.

Each of the Company, the Managers and their respective affiliates expressly disclaims any obligation or undertaking to update, review or revise any statement contained in this announcement whether as a result of new information, future developments or otherwise.

The distribution of this announcement and other information may be restricted by law in certain jurisdictions. Persons into whose possession this announcement or such other information should come are required to inform themselves about and to observe any such restrictions.