An affiliate of New York City-based Wellspring Capital Management LLC is buying OMNI Energy Services Corp. The definitive agreement calls for Wellspring to acquire all of OMNI’s outstanding shares for $2.75 per share in cash. The transaction is valued at $122 million, including assumption of debt.
OMNI, which is headquartered in Carencro, provides environmental and seismic services to the domestic oil and gas industry, and Wellspring Capital Management is a middle-market private equity firm that manages more than $2 billion of private equity capital.
The agreement was unanimously approved by OMNI’s board of directors after the recommendation of a special committee of independent directors. The cash consideration represents a premium of almost 30 percent over the closing price of OMNI shares on June 3. OMNI is publicly traded on the Nasdaq stock exchange.
“We believe this transaction will deliver an immediate and significant premium for our shareholders especially in light of the uncertain markets after the unprecedented drop in our end markets in 2009 and the continued current uncertainty in the Gulf of Mexico,” says Brian J. Recatto, president and CEO of OMNI.
Completion of the transaction, which is expected in the second half of 2010, is subject to approval by OMNI’s shareholders, regulatory approvals and customary closing conditions.
The transaction is not subject to a financing condition: Wellspring has furnished OMNI with commitment letters for the necessary debt financing. Three directors of OMNI, including Recatto, are participating with Wellspring in the transaction.
The merger agreement allows OMNI until July 16, 2010, to actively solicit other possible bidders and to respond to unsolicited inquiries by others interested in acquiring OMNI. Stephens Inc. will assist OMNI in connection with dealings with other possible bidders. Should a superior proposal be received and accepted, OMNI may, subject to certain conditions, including payment of a “break-up” fee of approximately $1.8 million plus expenses up to $0.75 million, terminate the merger agreement with Wellspring.
In light of the merger agreement, OMNI will not hold its annual shareholders meeting scheduled for June 9. Instead, OMNI expects to hold a special meeting of shareholders to vote on approval of the merger agreement in the second half of 2010.