Eurasia Drilling today confirmed it a had been approached about a possible merger.
The unnamed company submitted a proposal which included an offer consideration of $10.00 per share
Eurasia is scrambling to take the company private in a bid to “sustain itself through the expected prolonged and difficult market conditions”.
A company spokesperson said: “While EDC’s fundamentals are still robust in the long-term, the current performance is significantly impacted by a combination of challenging macro-economics, acceleration in ruble depreciation, continued geopolitical risks, upstream capex cuts by the Russian oil majors on the back of oil price pressure, compounded by changes in tax regulations for the oil sector, weak pricing for drilling, poor forward visibility on offshore activity and uncertainty in the services market stemming from sanctions.
“Given all of these challenges, the management of EDC believe they require maximum flexibility to manage the business, which is best facilitated by being a private company at this time. As cost management becomes a foremost priority, going private also releases material financial benefit.”
A special committee has since been formed to consider the latest offer before making its recommendation to the board.
Lord Clanwilliam, chairman of the Special Committee, said: “The board is focused on preserving shareholder value following the failure of the Schlumberger transaction which would have been extremely beneficial to shareholders. The cancellation of this transaction is particularly unfortunate given all the challenges EDC is now facing. We are currently reviewing the merger proposal with the assistance of professional advisers and we will make our recommendation to the board in due course.”