Flame Acquisition in an 8-K included a presewntation for potential PIPE investors highlighting its proposed merger with Sable Offshore, a Nova Scotia-based natural gas exploration consortium.
As announced in November 2021, the deal had an $883 million enterprise value, which assumed no redemptions. At that time, the SPAC said it intended to pursue 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.
The equity value of the transaction is $613 million.
The SPAC had 15,620,245 shares outstanding going into an August extension vote and said 2,328,063 shares were redeemed (about 15%). As a result, approximately $24 million ($10.31 per share) was removed from the trust. Based on the redemption price and remaining shares outstanding, Flame would have just over $137 million in trust.
As of August, total PIPE commitments amounted to $74.5 million.
The SPAC has until until March 1, 2024 to complete the deal.
Sable has an agreement to acquire the Santa Ynez oil 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.
