Brooge Energy Limited Announces Strategic Acquisition of BPGIC

Brooge Energy Limited's Key Acquisition Announcement

In an exciting development, Brooge Energy Limited, known as "BEL" (NASDAQ: BROG), has recently confirmed plans for a significant acquisition. The company, based in the Cayman Islands and focused on Clean Petroleum Products, Biofuels, and Crude Oil storage solutions, has signed a conditional sale and purchase agreement. This agreement entails the sale of 100% of the total issued share capital of Brooge Petroleum and Gas Investments Company FZE ("BPGIC FZE") and Brooge Petroleum and Gas Investment Company Phase III FZE ("BPGIC Phase III FZE"). The transaction reflects a strategic pivot aimed at bolstering BEL's influence within the energy sector.

Transaction Overview

The acquisition will see the transfer of the BPGIC Group, along with its subsidiaries, to Gulf Navigation Holding PJSC, referred to as "GulfNav". This marks a pivotal moment for both parties involved; GulfNav is set on expanding its storage and logistics capabilities through BPGIC's modern infrastructure, which is vital for storing fuel oil, crude oil, and other petroleum products. With this move, GulfNav aims at achieving operational efficiency, enhancing service quality, and delivering value to its stakeholders.

Strategic Benefits for GulfNav

This acquisition is not just about numbers; it represents GulfNav’s vision of becoming a key player in the evolving energy landscape. By integrating BPGIC’s state-of-the-art facilities, GulfNav is set to streamline its operations while providing a more comprehensive service portfolio. BEL's board expressed their satisfaction with this transaction, emphasizing their commitment to generating long-term value for shareholders.

Key Financial Details

The total consideration for the transaction is estimated at approximately USD 884 million (AED 3,245,000,000). The funds will be structured through a combination of cash and equity considerations:

• Cash Payment: About USD 125.3 million (AED 460,000,000), with portions allocated to an escrow account to ensure transaction security.
• Equity Issuance: GulfNav will issue 358,841,476 ordinary shares at a price of USD 0.34 (AED 1.25) per share, totaling approximately USD 122 million (AED 449 million).
• Mandatory Convertible Bonds: The issuance of bonds valued at around USD 636 million (AED 2,336 million) will convert into GulfNav shares, aligning with the individuals who are part of this transformative deal.

These shares and bonds will have a 12-month lock-up period ensuring stability post-transaction completion.

Conditions and Conclusion of the Transaction

To ensure a smooth transaction process, several conditions must be satisfied which include shareholder approval at GulfNav, necessary regulatory approvals, and the successful completion of funding through a mandatory convertible bond offering. Each party will also provide customary warranties under the terms of the Agreement, as is standard practice for such transactions.

Completion is anticipated within five business days once all conditions are met, highlighting a proactive approach from both BEL and GulfNav throughout the process. They aim to finalize this strategic acquisition ahead of the predefined Long Stop Date, which is three months post-agreement unless otherwise modified by mutual consent.

Future Directions

Upon concluding the acquisition, both BEL and GulfNav will implement shared governance principles, ensuring that each party has representation on GulfNav's board. Additionally, BEL is expected to provide details regarding the distribution of the proceeds to its shareholders as the completion date approaches.

About Brooge Energy Limited

Brooge Energy Limited (BEL) is dedicated to providing top-notch storage services for Clean Petroleum Products and Biofuels. Its subsidiary, BPGIC FZE, plays a crucial role by strategically positioning its operations near the Strait of Hormuz at the Port of Fujairah, United Arab Emirates. Recognized for its efficient order processing and customer-focused services, BPGIC stands out from its competitors in the industry.

About Gulf Navigation Holding PJSC

GulfNav is a leading maritime and shipping firm based in Dubai, with a mission centered on excellence within the maritime sector. This acquisition cements its commitment to expanding capabilities and maintaining its esteemed reputation in the industry.

Frequently Asked Questions

1. What is the significance of the acquisition for Brooge Energy Limited?

This acquisition allows BEL to enhance its operational capabilities and strategic positioning in the energy sector, driving long-term shareholder value.

2. What is the total estimated value of the transaction?

The transaction is valued at approximately USD 884 million (AED 3,245,000,000), combining cash and equity considerations.

3. Who is purchasing the BPGIC Group?

The BPGIC Group is being acquired by Gulf Navigation Holding PJSC as part of their strategic growth initiatives.

4. What are the expected benefits of this acquisition for GulfNav?

GulfNav aims to improve its storage and logistics capabilities, achieve operational efficiencies, and expand its service offerings through this acquisition.

5. When is the transaction expected to be completed?

Completion is expected within five business days following the satisfaction of necessary conditions, with a target to finalize the deal within three months from agreement signing.

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