Deal Description: Superior Energy Services, Inc. (“Superior Energy”) (NYSE: SPN; OTCQX: SPNV) today announced that it has entered into a definitive agreement to divest its U.S. service rig, coiled tubing, wireline, pressure control, flowback, fluid management and accommodations service lines (the “Superior Energy U.S. Business”) and combine them with Forbes Energy Services Ltd.’s (“Forbes”) (OTCQX: FLSS) complementary service lines to create a new, publicly traded consolidation platform for U.S. completion, production and water solutions.
Under the terms of the merger agreement, the Superior Energy U.S. Business and Forbes will be merged into a newly formed company (“Newco”) and various debts will be refinanced. At the closing of the transaction, Superior Energy will receive (i) an approximate 65% economic interest in Newco (52.0% on a fully diluted basis) and (ii) $250 million in newly issued senior secured notes due 2027 of Newco, which will be exchanged for an equivalent amount of existing unsecured notes of a subsidiary of Superior Energy. Forbes shareholders will receive an approximate 35% economic interest in Newco (48.0% on a fully diluted basis).
The transaction, which is expected to close in the first quarter of 2020, has been unanimously approved by the Board of Directors of each of Superior Energy and Forbes and unanimously approved by the special committee of the Board of Directors of Forbes. The closing of the transaction is subject to approval by Forbes’s stockholders and various other closing conditions. Ascribe Capital LLC and Solace Capital Partners, who collectively own approximately 40% of the outstanding common stock of Forbes, have committed to vote their shares in favor of the transaction.
Financial Advisor to Superior Energy Services, Inc.: Lazard Frères & Co. LLC
Outside Counsel to Lazard Frères & Co. LLC: Baker Botts L.L.P.
Baker Botts Lawyers/Office Involved:
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