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Savannah Energy plc
Acquisition of certain of Seven Energy’s Nigerian assets for an aggregate consideration of US$301m, satisfied through a combination of cash, equity and assumed debt (the “Acquisition”), constituting a reverse takeover under the AIM Rules, and associated placing raising US$125m (the “Transaction”).
US$301m
Background
Savannah Energy plc (formerly named Savannah Petroleum plc) (“Savannah” or the “Company”) admitted to trading on AIM in July 2014, simultaneously raising US$50 million in new equity, with Strand Hanson acting as its Financial & Nominated Adviser.
In 2017, Savannah announced, and published an admission document in respect of, its conditional acquisition of certain upstream and midstream Seven Energy assets in Nigeria, expanding on its existing upstream assets in Niger, constituting a reverse takeover under the AIM Rules. The Acquisition was subject to a number of conditions, including shareholder approval, certain creditor approvals, a capital reorganisation of Seven Energy and ministerial consent. The Company also announced the completion of a placing raising US$125 million.
Following the announcement in 2017, the Acquisition structure was amended whereby, inter alia, Savannah reduced the interest it would acquire in certain of the upstream assets and increase the interest it would acquire in the midstream business, Accugas. The Acquisition completed in November 2019 with Savannah ultimately acquiring:
- an 80% interest in Seven Uquo Gas Limited which holds a 40% participating interest in the Uquo field located in South East Nigeria;
- a 51% interest in the Stubb Creek field located in South East Nigeria; and
- an 80% interest in the Accugas midstream business, comprising the 200 mmscfd Uquo gas processing facility, a c.260km pipeline network and long-term gas sales agreements with downstream customers.
Our role
Strand Hanson assisted Savannah with all the typical workstreams associated with a reverse takeover transaction on AIM, including pertinently the organisation of numerous parties across several countries. Due to the complex nature of the Transaction, with the numerous conditions of the Acquisition affecting the timetable, as well as the development of the structure of the Acquisition over time, post signing of the SPA and publication of the initial AIM admission document, Strand Hanson played a key role in the coordination of and communication with the various stakeholders. Strand Hanson supported the Company in negotiations and ensured that it complied with various regulatory requirements and made appropriate market disclosures, including the publication of the supplemental admission document in respect of the Acquisition following the changes to the transaction structure.
Subsequent Transactions
In 2022, Savannah completed its acquisition of ExxonMobil’s entire midstream asset portfolio in Cameroon, including a c. 41% interest in Cameroon Oil Transportation Company S.A. (“COTCo”), constituting a further reverse takeover transaction under the AIM Rules.
COTCo owns and operates the 903km Cameroon section of the Chad-Cameroon export pipeline, the Kome Kribi 1 floating storage and offloading facility, and related infrastructure. The pipeline has a 250 Kbopd nameplate capacity and is the only international export route for oil production in Chad. During 2022, COTCo transported an average of 124 Kbopd of crude oil valued at an estimated US$4.6bn at the prevailing Brent crude oil prices.
In 2023, the Company sold a 10% interest in COTCo to the national oil company of Cameroon, Société Nationale Des Hydrocarbures, giving Savannah a resultant interest in COTCo of c. 31%.
Savannah’s renewable energy division is developing up to 525 megawatts of hydroelectric, solar photovoltaic and wind projects in Cameroon and Niger, leveraging its existing presence in-country.