HAMILTON, Bermuda, Dec. 20, 2006 (PRIME NEWSWIRE) -- Reference is made to the decision of the Appeal Board of the Oslo Stock Exchange announced on December 13, 2006, requiring Seadrill to make a new mandatory offer for the shares in Eastern Drilling ASA (Eastern).
Seadrill remains of the opinion that the decision does not reflect the facts and that the interpretation of the law reflected therein is wrong. Seadrill will therefore request the ordinary courts to review the decision.
A verdict in Seadrill's favour will give Seadrill the possibility to reduce its holding to less than 40 percent and thus not require Seadrill to make a mandatory bid for the outstanding shares in Eastern. Such a verdict can also be used as basis for a claim for compensation against the Oslo Stock Exchange and the Ministry of Finance (being responsible for the Appeal Board).
Seadrill however, after having reviewed the overall situation for Eastern and its shareholders, intends to put forward a new mandatory offer for the outstanding shares in Eastern. Seadrill's decision is primarily motivated by its concern for the smaller shareholders in Eastern, as the alternative, i.e. to challenge the Appeal Board's decision before the courts, will create a long period of uncertainty in relation to the pricing of Eastern's shares.
As the Appeal Board's decision did not specify the price in a new mandatory offer, such price will have to be set by Seadrill and then subsequently approved by the Oslo Stock Exchange.
Seadrill is of the opinion that the offer price must be based on the highest price paid by Seadrill and Carnegie ASA during the period they, according to the Appeal Board's decision, acted in concert. The offer price must also reflect the dilutive effect of Eastern's capital increase targeted to existing investors in June this year. A new mandatory offer will furthermore be subject to Seadrill and the Oslo Stock Exchange finding a solution as to how to deal with Seadrill's compensation claim in the event the Appeal Board's decision is reversed by the ordinary courts.
Seadrill intends to deliver a draft offer document to Oslo Stock Exchange for review within the required 30 day-period.
Seadrill Limited Hamilton, Bermuda December 20, 2006