Following receipt of Canadian Competition Bureau approval, CE Franklin Ltd. (“CE Franklin”) completed a plan of arrangement with a wholly owned subsidiary of National Oilwell Varco, Inc. (“NOV”), NOV Distribution Services ULC (“NDS”). The arrangement resulted in NDS acquiring all of the issued and outstanding common shares (the “Common Shares”) of CE Franklin for consideration of $12.75 in cash per Common Share. Following a special meeting of the shareholders of CE Franklin on July 16, 2012, the Alberta Court of Queen's Bench approved the plan of arrangement.
The total consideration payable under the arrangement was approximately $240 million. The consideration per Common Share represents a 36 per cent premium to the closing price of the Common Shares on the TSX on May 30, 2012, and a 36 per cent premium to the volume weighted average price of the Common Shares on the TSX over the 20-day period prior to April 17, 2012, when CE Franklin announced that it was conducting a review of strategic alternatives. Schlumberger Limited, the holder of 56 per cent of the outstanding Common Shares, agreed to vote in favour of the arrangement.
National Oilwell Varco is a worldwide leader in the design, manufacture and sale of equipment and components used in oil and gas drilling and production operations, the provision of oilfield services and supply chain integration services to the upstream oil and gas industry.
CE Franklin has been a leading supplier of products and services to the energy industry for more than 75 years. The company distributes pipes, valves, flanges, fittings, production equipment, tubular products and other general oilfield supplies to oil and gas producers in Canada as well as to the oil sands, refining, heavy oil, petrochemical, forestry and mining industries. These products are distributed through its 39 branches, which are situated in towns and cities serving particular oil and gas fields of the western Canadian sedimentary basin.
Fraser Milner Casgrain LLP represented NOV in the transaction, with a team led by Bill Gilliland (securities) and including Toby Allan, Keith Inman and Karam-Ali Talakshi (securities); Derek Kurrant (tax); Barry Zalmanowitz and Sandy Walker (competition); Correna Jones (employment) and Brian Foster (litigation). Burnet, Duckworth & Palmer LLP acted as legal advisor to the special committee of the CE Franklin Board with a team consisting of Steve Cohen and Ted Brown.
Norton Rose Canada LLP represented CE Franklin in the transaction, with a team led by Robert Engbloom (securities) and including Lianne Tysowski, Don Tse, Jason Metcalf, Katherine Prusinkiewicz, Elizabeth von Engelbrechten (securities); Dion Legge (tax); John Carleton and Denis Gascon (competition) and Steve Leitl (litigation). Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as US counsel to CE Franklin, Ltd. with a team including Andrew Foley, Justin Hamill, Phillippe Savard and former associate Anat Aronowicz (corporate) and David Mayo and Brian Grieve (tax).
Davies Ward Phillips & Vineberg LLP acted as legal adviser to Schlumberger, CE Franklin's largest shareholder, with a team consisting of Peter Hong (M&A) and Anita Banicevic (competition).