PGS, the world’s geo-services company, has rejected an offer from TGS-NOPEC Geophysical Company to acquire its multi-client data library.
TGS proposed to acquire PGS’s multi-client data library but the board of PGS 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 USD600 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 advisors, PGS has concluded that the proposal is not in the best interest of the company and its stakeholders.
“PGS remains committed to its integrated service strategy and the benefits to the Company and its stakeholders from the combination of MultiClient and Contract operations.
“PGS remains focused on its ongoing discussions with its lenders, as previously announced,” PGS said in a statement
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.”