Investor Relations

 

EUR 100 mn for capacity expansions, new sites and business expansion

Capital increase in the period from March 10 to 25, 2005

 

Ternitz/Vienna, March 10, 2005. Schoeller-Bleckmann Oilfield Equipment AG (SBO), listed in the prime market of the Vienna Stock Exchange, plans the largest investment programme in the company’s history. As the Managing Board announced at a press conference in Vienna, SBO is planning to spend approximately EUR 100 mn until 2007 for strategic investments. These investments will include the expansion of production capacities, new sites and the expansion of the high-precision components' business for the oilfield service industry. Approximately half of the programme will be financed by a capital increase being carried out as of now until March 25, from cash-flow and outside funds.

 

The new shares offered for subscription as of today, Thursday, will be issued under a combined offer. On the one hand, this offer consists of a subscription rights offer to existing shareholders who may exercise their subscription rights until the end of the subscription period on March 25. The subscription ratio is 13:3, so that for 13 old shares 3 new shares can be subscribed. A trading of subscription rights is not planned. On the other hand, the combined offer of SBO comprises of a public offer to private and institutional investors in Austria as well as of a private placement to international institutional investors. In addition, Berndorf AG, which currently holds just above 50% of the shares of SBO, will offer another 1.16 million shares. Finally, Berndorf AG granted an over allotment option of up to 500,000 shares to the Joint Lead Managers will be added from 's portfolio.

 

 

After complete placement of the new shares and Berndorf AG's shares as well as in case of full exercise of the over allotment option, SBO will be a publicly owned company of which Berndorf AG will remain the largest shareholder with approximately 31 %. At the press conference, Berndorf’s CEO and owner Mag. Norbert Zimmermann explained that Berndorf wants to remain a long-term core shareholder of SBO. By selling the majority shareholding, Mr Zimmermann expects a further increase of the liquidity of the SBO share.

 

The issue price will be determined by way of a book building procedure, whereby the maximum price shall be EUR 22.00 per share. The final issue price per share will presumably be announced on presumably March 29, 2005. The new shares will be fully entitled to a dividend for the financial year 2005 and will be quoted in the segment prime market, ATX of the Vienna Stock Exchange, presumably as of April 1, 2005.

 

The transaction is led by Raiffeisen Centrobank as the sole global coordinator. Joint Lead Managers and Joint Bookrunners are Raiffeisen Centrobank and Bank Austria Creditanstalt. 

 

 

SBO’s CEO Gerald Grohmann explained that SBO's investment surge is due to structural changes and the market situation in the oilfield service industry. „Due to the steep rise in oil demand we expect to see an average growth of around 7% in the oilfield service industry in the next years, as the additional demand can only be covered by exploring new oil deposits“, said Mr Grohmann.

 

SBO as the global market leader in high-precision components for the oilfield service industry intends to benefit from this strong growth. As in the next years largely oil deposits located offshore or in great depths will be explored, increased use of high technology, in particular in directional drilling, will be required. „This will lead to a substantial stimulation of demand for SBO’s high-precision components, since we have specialized in this technology “, said Mr Grohmann.

 

 

SBO will, therefore, expand capacities at the existing highly advanced production sites in the US and Austria by appropriate investments. Moreover, additional sites are to be opened in regions with lower costs. The first step in that direction was taken in 2004 by founding a production company in Mexico. Finally, SBO will develop and launch new products both in the field of high-precision components and drilling motors.

 

As a result of the expansion of drilling activities, new oil production centres are emerging around the globe. SBO intends to follow its customers and also set up local Service & Supply shops in these new oil production regions. A first step in that direction is a new service facility in Siberia that is just being established.

 

 

According to Mr Grohmann, the structural change in the oilfield service industry will continue in the years to come. The large internationally operating oilfield service companies will increasingly outsource their production and services to other companies to better focus on their core business. SBO wants to be an active player in this market and, expand its business model by acquisition of further production facilities over production capacities. „We expect to reserve more than half of the revenue generated from the capital increase exactly for this purpose“, said Mr Grohmann. In a further step, the product range of SBO could also be extended to business segments that are very close to the current core business.

 

 

According to Chief Financial Officer Franz Gritsch, SBO intends to maintain its sound balance-sheet structure in spite of the extensive strategic investment programme. SBO aims at a long-term equity ratio of around 50% to be immune against any periodic fluctuations in business development. However, SBO also wants to be able to seize acquisition opportunities at any time, which is why funding the growth via a capital increase is the right decision. SBO’s policy of offering an attractive dividend to its shareholders is what Mr Gritsch wants to maintain even in the dynamic growth development expected in the next years.

 

The Managing Board of SBO will participate privately in the capital increase.

 

 

 

 

 

Schoeller-Bleckmann Oilfield Equipment AG is the global leader for high-precision components for the oilfield service industry. The business focus is on non-magnetic drillstring components for directional drilling. Worldwide, SBO employs a workforce of 837 (December 31, 2003: 800), currently 211in the company headquarters at Ternitz, Lower Austria, and 435 in North America (including Mexico). The majority shareholder of the company is Berndorf AG.

 

 

For information please contact:

Gerald Grohmann, Chief Executive Officer

Schoeller-Bleckmann Oilfield Equipment AG

A-2630 Ternitz, Hauptstraße 2
Tel: +43 2630/315 ext. 110, fax: ext. 101

E-mail: sboe@sbo.co.at

 

Mick Stempel, Hochegger|Financials
Tel: +43 1/504 69 87 ext. 85

E-mail: m.stempel@hochegger.com

 

 

Important notice:

 

"Diese Presseaussendung sowie die darin enthaltenen Informationen dürfen nicht in die Vereinigten Staaten von Amerika (USA), nach Kanada, Japan oder Australien gebracht oder übertragen werden oder an US-amerikanische, kanadischen, japanischen oder australischen Personen (einschließlich juristischer Personen) sowie an Publikationen mit einer allgemeinen Verbreitung in den USA, in Kanada, Japan oder Australien verteilt oder übertragen werden. Jede Verletzung dieser Beschränkungen kann einen Verstoß gegen US-amerikanische, kanadische, japanische oder australische wertpapierrechtliche Vorschriften begründen. Aktien der SCHOELLER-BLECKMANN OILFIELD EQUIPMENT Aktiengesellschaft (die "Gesellschaft") werden in den USA, in Kanada, Japan oder Australien nicht zum Kauf angeboten. Diese Presseaussendung ist kein Angebot zum Kauf oder zur Zeichnung von Aktien oder sonstigen Wertpapieren und Finanzinstrumenten. Wertpapiere der Gesellschaft werden außerhalb von Österreich, insbesondere in den USA, nicht öffentlich zum Kauf angeboten. Ein börse- und kapitalmarktrechtlichen Vorschriften entsprechender Prospekt wurde am 9.März 2005 bei Oesterreichische Kontrollbank Aktiengesellschaft als Meldestelle hinterlegt und gemäß § 10 Kapitalmarktgesetz im Amtsblatt zur Wiener Zeitung veröffentlicht. Der Prospekt ist am Sitz der SCHOELLER-BLECKMANN OILFIELD EQUIPMENT Aktiengesellschaft, Hauptstraße 2, 2630 Ternitz, bei Raiffeisen Centrobank AG, Tegetthoffstraße 1, 1015 Wien, sowie bei Bank Austria Creditanstalt AG, Vordere Zollamtsstraße 13, 1030 Wien, Am Hof 2, 1010 Wien, und Schottengasse 6, 1010 Wien, zu den üblichen Geschäftszeiten in Form einer Broschüre unentgeltlich erhältlich. Im Zusammenhang mit dem Angebot von Aktien der Gesellschaft sind ausschließlich die Angaben im Prospekt verbindlich."

 

"THIS PRESS RELEASE IS NOT BEING ISSUED IN THE UNITED STATES OF AMERICA, CANADA, JAPAN AND AUSTRALIA AND SHOULD NOT BE DISTRIBUTED TO US-, CANADIAN, JAPANESE OR AUSTRALIAN PERSONS OR PUBLICATIONS WITH A GENERAL CIRCULATION IN THE UNITED STATES, CANADA, JAPAN OR AUSTRALIA. IN ADDITION, THE SHARES OF SCHOELLER-BLECKMANN OILFIELD EQUIPMENT Aktiengesellschaft (THE "COMPANY") HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES, CANADIAN, JAPANESE AND AUSTRALIAN SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD OR DELIVERED WITHIN THE UNITED STATES, CANADA, JAPAN OR AUSTRALIA OR TO US-, CANADIAN, JAPANESE OR AUSTRALIAN PERSONS. THIS DOCUMENT DOES NOT CONSTITUTE AN OFFER OR INVITATION TO SUBSCRIBE FOR OR PURCHASE ANY SHARES OR ANY OTHER SECURITIES. Securities of the Company are not publicly offered outside OF Austria, in particular the U.S.A. An offering circular (prospectus) prepared in accordance with applicable Austrian capital markets and stock exchange laws has been filed with Oesterreichische Kontrollbank Aktiengesellschaft as Notification Office on March 9, 2005 and published in accordance with section 10 of the Austrian Capital Markets Act. The offering circular may be obtained at SCHOELLER-BLECKMANN OILFIELD EQUIPMENT Aktiengesellschaft, Hauptstrasse 2, A-2630 Ternitz, at Raiffeisen Centrobank AG, Tegetthoffstrasse 1, A-1015 Vienna, and at Bank Austria Creditanstalt AG, Vordere Zollamtsstrasse 13, A-1030 Vienna, Am Hof 2, A-1010 Vienna, und Schottengasse 6, A-1010 Vienna, during usual business hours. In connection with the public offering of shares of the COMPANY, only the information contained in the offering circular is legally binding. "