Investor Presentation KCA DEUTAG. Bondholder Consent Solicitation

Transcription

1 Investor Presentation Bondholder Consent Solicitation KCA DEUTAG 13th March 2018 KCA Deutag is a leading international drilling and engineering company working onshore and offshore with a focus on safety, quality and operational performance

2 Executive Summary KCA Deutag has agreed to acquire the Omani / Saudi businesses of Dalma Energy KCA Deutag: leading global drilling and engineering onshore and offshore contractor Dalma Energy: leading provider of onshore drilling services to oil & gas companies in the Middle East Combines Dalma s regional expertise with KCAD s international standards and global network Acquired assets valued at an EV of $660m, 6.0x LTM December 2017E EBITDA of c.$110m (1) Deleverages Company from 4.9x to 4.7x, pro forma for the transaction Consent required from existing Bondholders to amend the debt incurrence covenant and allow for additional senior secured debt to be raised under the contemplated $425m acquisition financing Completion of the Transaction not dependent on receiving the consents from bondholders Notes: (1) Dalma EBITDA is before exceptional items. 1

3 Sources & Uses and Pro Forma Capitalisation Sources $m Uses $m Pro-Forma Capital Structure (31-Dec-2017) Sources & Uses New debt issued by KCAD 425 Refinancing existing Dalma level debt 362 KCAD cash on hand 85 Consideration payable in cash 100 Transaction fees and expenses 47 Total Cash Sources 510 Total Cash Uses 510 Shares issued by KCAD to sellers 220 Shares issued by KCAD to sellers 220 Total Transaction Sources 730 Total Transaction Uses 730 As of 31-Dec-2017 As of 31-Dec-2017 Adjustment USD millions KCA Deutag xebitda 4 Dalma xebitda PF Combined xebitda 4 Cash and Cash Equivalents (31-Dec-17) x 1 0.0x (85) x Revolver ($275m Capacity) Dalma Secured Lines ($20m Capacity) $375m Sr. Secured TLB due HSBC Oman Term Loan Dalma Senior Facilities (357) - Total Bank Debt x x (357) x $375m 7.250% Sr. Secured Notes due $535m 9.875% Sr. Secured Notes due New $425m Sr. Secured Acquisition Financing x Finance Lease & Other Debt Total Debt, Gross 1, x x 68 1, x Total Debt, Net 1, x x 1, x 31 December 2017 KCAD: Adjusted EBITDA Dalma: 31-Dec-2017 EBITDA before exceptional items PF Synergies and Combined EBITDA Notes: (1) Q LTM EBITDA of $246m includes the $25m Holdco equity contribution as defined in the Amended Credit Agreement and also removes EBITDA of $0.6m relating to MODUs (2) Dalma EBITDA is before exceptional items (3) Combined EBITDA includes estimated synergies of >$10m on a run rate basis (4) Leverage shown based on adjusted EBITDA of $246m for KCAD and combined EBITDA of $366m (5) Cash of $1m at Dalma reflects $23m of cash at year end 2017 less $22 million of cash which may be extracted by the Sellers at or before the Completion Date. 2

4 Overview of the Consent Solicitation Summary Terms and Conditions Target Bonds $375,000, % Notes due 2021 $535,000, % Notes due 2022 Key Amendments: Incurrence of additional senior secured debt to allow for the $425m acquisition financing Extending Q reporting period from 60 to 90 days to allow additional time for first quarter consolidating Target Consent Fee 0.50% Payable once the new bond financing has settled Thresholds Required Holders of at least a majority in aggregate principal amount of each of the Notes Indicative Key Dates: Launch Date - March 13, 2018 Expiration Date - 5:00 p.m. New York time on March 19, 2018 (noteholders custodial deadlines will be earlier than this time) Payment Date - Promptly after the satisfaction or waiver of all Conditions with respect to the relevant Solicitation Solicitation Agent Citigroup For any queries regarding the Consent Solicitation please reach out to Citigroup Tabulation Agent and the Information Agent: D.F. King & Co., Inc. Please reach out to DF King to receive a copy of the Consent Solicitation Statement or if you have any queries on the procedures to consent Further details on the Consent solicitation are included in the Consent Solicitation Statement which is available from DFKing 3

5 Disclaimer NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO, OR TO ANY PERSON LOCATED OR RESIDENT IN, ANY OTHER JURISDICTION WHERE IT IS UNLAWFUL TO RELEASE, PUBLISH OR DISTRIBUTE THIS PRESENTATION. This presentation does not constitute an offer to sell or issue, or the solicitation of an offer to buy or subscribe for, securities (including the securities mentioned in this announcement) in any jurisdiction. The distribution of this presentation, and the making of the consent solicitations described herein (the Solicitations ) and the consent fees described herein (the Consent Payments ), may be restricted by law in some jurisdictions. Persons into whose possession this presentation comes must inform themselves about and observe these restrictions. Terms used but not defined herein have the meanings ascribed to them in the Solicitation Documents (as defined below). This presentation is for information purposes only and the Solicitations are only being made pursuant to the terms of the consent solicitation statement dated March 13, 2018 and the accompanying consent form (the Solicitation Documents ). Holders are advised to read the Solicitation Documents carefully before any decision is made with respect to the proposed amendments described therein (the Proposed Amendments ), and for full details of, and information in relation to, the procedures for participating in the Solicitations, including details of the Consent Payments. If any Holder of Notes is in any doubt as to the action it should take or is unsure of the impact of the implementation of the Proposed Amendments, it is recommended to seek its own financial and legal advice, including as to any tax consequences, immediately from its stockbroker, bank manager, solicitor, accountant or other independent financial or legal adviser. None of the Issuer, the Company, the Tabulation Agent, the Information Agent, the Solicitation Agent, the Trustee, the Security Agent or any of their respective directors, officers, employees, agents or affiliates makes any recommendation as to whether a Holder of Notes should consent to the Proposed Amendments and none of the Issuer, the Company or their respective boards of directors have authorized any person to make any such statement. This presentation includes forward-looking statements. All statements, other than statements of historical fact, included in this announcement regarding the Issuer s or the Company s financial condition or regarding future events or prospects are forward-looking statements. The words aim, anticipate, believe, continue, estimate, expect, future, help, intend, may, plan, shall, should, will or the negative or other variations of them as well as other statements regarding matters that are not historical fact, are or may constitute forward-looking statements. The Issuer and the Company have based these forward-looking statements on management s current view with respect to future events and financial performance. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements and from past results, performance or achievements. These risks, uncertainties and assumptions could adversely affect the outcome and financial consequences of the plans and events described herein. No one undertakes any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. You should not place any undue reliance on forward-looking statements which speak only as of the date of this presentation. All subsequent written or oral forward-looking statements attributable to the Issuer or the Company, or persons acting on their behalf, are expressly qualified in their entirety by the cautionary statements contained throughout this presentation. 4