Flame Acquisition in a proxy filing offered additional detail on its proposed merger with Sable Offshore, a Nova Scotia-based natural gas exploration consortium. Announced earlier this month, the deal has an $883 million enterprise value.
Flame holds approximately $289 million cash in trust. The deal is further supported by a $71.5 million PIPE. The SPAC said it intends to pursue additional PIPE subscriptions totalling up to $400 million. Flame has also secured a $623 million five-year term loan at 10% annual interest. The loan requires a $19 million deposit up front.
If approved, the deal would put about $258 million on Sable’s balance sheet. The company intends to spend $331 million on start-up costs for newly acquired assets and lease operating expenses. These will stem from Sable’s agreement to acquire the Santa Ynez field in Federal waters off the California coast and associated onshore processing and pipeline assets from Exxon Mobil and Mobil Pacific Pipeline Company for $625 million. Read more.
