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SANTA FE ENERGY RESOURCES ANNOUNCES MERGER WITH ADOBE RESOURCES

 SANTA FE ENERGY RESOURCES ANNOUNCES MERGER WITH ADOBE RESOURCES
 NEW YORK, Dec. 11 /PRNewswire/ -- James L. Payne, chairman and chief executive officer of Santa Fe Energy Resources, Inc. (NYSE: SFR), and Stanley R. Rawn Jr., chairman and chief executive officer of Adobe Resources Corporation (NYSE: ADB), today announced the signing of a definitive merger agreement under which Adobe Resources will be merged with and into Santa Fe Energy Resources.
 The merger is expected to result in a combined company with a greater cash flow per share, a lower debt-to-equity ratio, and an annual reduction in the combined overhead of more than $15 million. The merger will provide Santa Fe with higher immediate revenues from the Gulf of Mexico, a position in the natural gas pipeline, processing and marketing business, established production in West Texas, and an expanded role in international oil exploration and production operations. These assets complement Santa Fe Energy's very long term rising production profile in California crude oil, as well as its existing operations in West Texas, the Gulf of Mexico, and overseas.
 The agreeement must be approved by the stockholders of each company. Special meetings of the stockholders of each company will be called to approve the merger near the end of the first quarter of next year.
 Adobe Resources Corporation currently has three classes of equity securities -- common stock, 9.2 percent convertible preferred stock, and 12 percent preferred stock. The merger agreement provides the following:
 (a) that each share of Adobe Resources common stock will be converted into 0.6196 shares of Santa Fe Energy Resources common stock;
 (b) that each share of Adobe Resources 9.2 percent convertible preferred stock will be converted into 0.5974 shares of Santa Fe Energy Resources common stock plus 0.5065 shares of a new convertible series of Santa Fe Energy Resources preferred stock; and
 (c) that each share of Adobe Resources 12 percent preferred stock will be converted into 0.7029 shares of Santa Fe Energy Resources common stock plus 0.5959 shares of the new Santa Fe Energy Resources convertible preferred stock.
 Santa Fe Energy Resources has received irrevocable proxies from Minorco (U.S.A.) Inc. (beneficial owner of 14,518,245 shares of Adobe common stock), B.J. Pevehouse (former president of Adobe and beneficial owner of 333,461, 1,152,473 and 1,182,996 shares of Adobe common stock, 9.2 percent convertible preferred stock and 12 percent preferred stock, respectively), and Stanley R. Rawn Jr. (beneficial owner of 204,630, 27,475 and 83,275 shares of Adobe common stock, 9.2 percent convertible preferred stock and 12 percent preferred stock, respectively) to vote their shares in favor of the merger at Adobe's stockholders meeting.
 Adobe Resources has received an irrevocable proxy from Itel Corp., beneficial owner of 8,064,005 shares of Santa Fe Energy Resources stock, to vote its shares in favor of the merger at the meeting of Santa Fe Energy Resources stockholders. In addition, Olympia & York SF Holdings Corporation, beneficial owner of 9,724,078 shares of Santa Fe Energy Resources stock, has provided a written indication of its intention to vote in favor of the merger at that meeting. Lionel Dodd, a director of Santa Fe Energy Resources and chief operating officer of O & Y Enterprises Inc., stated, "Olympia & York strongly supports the merger of Santa Fe Energy Resources with Adobe Resources, and believes the transaction will be in the best interest of all the stockholders of Santa Fe Energy Resources."
 Holders of the new convertible preferred shares of Santa Fe Energy Resources, which are to be issued in the merger, will have the right to receive cumulative dividends, when declared, at an annual rate of $1.40 per share payable quarterly. That new series of stock will have a liquidation preference of $20.00 per share and will be convertible into common shares of Santa Fe Energy Resources at the ratio of 1.3913 common shares for each preferred share, subject to adjustments.
 The common shares of Adobe Resources closed Monday on the New York Stock Exchange at $6.125. Adobe's 9.2 percent convertible preferred shares and 12 percent preferred shares each closed Monday on the NYSE at $15.875 and $18.125, respectively. Adobe has approximately 30.7 million common shares, 4.2 million 9.2 percent convertible preferred shares and 4.9 million 12 percent preferred shares outstanding. The common stock of Santa Fe Energy Resources closed Monday on the NYSE at $9.625. Santa Fe Energy Resources has approximately 63.8 million common shares outstanding.
 Santa Fe Energy Resources, headquartered in Houston, is an independent (non-integrated) oil and gas exploration and production company, with annual sales of $382.9 million for the year ended Dec. 31, 1990. Adobe Resources Corporation, headquartered in New York, is primarily engaged in domestic and international oil and gas exploration and production as well as the gathering, processing, transmission and marketing of natural gas. Its annual sales were $159.1 million for the year ended Dec. 31, 1990.
 In addition to the required stockholder approvals, consummation of the merger is also subject to satisfaction of various conditions, including the receipt of approvals and the release of Adobe Resources from certain guaranty obligations.
 Lehman Brothers is acting as financial advisor to Santa Fe Energy Resources in this transaction and has rendered a fairness opinion to Santa Fe Energy's board of directors. Goldman Sachs and Lazard Freres are acting as financial advisors to Adobe Resources and have also rendered a fairness opinion to Adobe Resources' board of directors.
 -0- 12/11/91
 /CONTACT: Robert F. Vagt of Adobe Resources, 212-758-8110/
 (SFR ADB) CO: Santa Fe Energy Resources, Inc.; Adobe Resources Corporation ST: Texas IN: OIL SU: TNM


GK -- NY029 -- 1411 12/11/91 11:15 EST
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Date:Dec 11, 1991
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