Ensign Energy wins bidding war to acquire 56.38% of Trinidad Drilling

Canada-based Ensign Energy Services has won the bidding war against drilling rig contractor Precision Drilling for the ownership of Trinidad Drilling after 56% of Trinidad’s shareholders supported its unsolicited all-cash takeover bid.

In a statement, Ensign claimed that 56.38% of the common shares of Trinidad have been tendered to its $1.68 per share offer made in August.

Made after the completion of a strategic review, the offer valued Trinidad at C$947m ($713.44m), which included an estimated outstanding net debt of C$477m ($359.35m).

Ensign already owns 26,863,239 shares in Trinidad and has now increased its ownership to 66.18% of the issued and outstanding Trinidad shares.

After Ensign made its offer, Precision Drilling reached an agreement to acquire Trinidad in an all-stock deal worth $794.28m.

According to the offer, Precision agreed to issue 0.445 common shares for each outstanding Trinidad share.

Trinidad favoured the Precision deal as it believed that it is better than that of Ensign.

Following the Ensign’s announcement regarding the shareholders’ support, Precision is now demanding payment of the C$20m ($15.06m) termination fee in accordance with the agreement with Trinidad.

Ensign added: “The offer is being extended for the statutory mandatory extension period to 10 December 2018 at 5:00pm (Toronto time) so that Trinidad shareholders who have not yet tendered their Trinidad shares will have the opportunity to tender to the offer.”

Services offered by Ensign include drilling, directional drilling, well servicing, and testing.

Trinidad Drilling operates its fleet of rigs in Canada, the US, Mexico and the Middle East.