Norsk Hydro Asa · OSL:NHY
Norsk Hydro Asa — Merger or Acquisition (December 2006)
26 slides from Norsk Hydro Asa's merger presentation, Dec 18, 2006
Slide 1: Press conference
Press conference Oslo 18.12.2006
Slide 2: Cautionary note in relation to certain forward-looking statements
Cautionary note in relation to certain forward-looking statements Certain statements contained in this announcement constitute “forward-looking information” within the meaning of Section 27A of the US Securities Act of 1933, as amended, and Section 21E of the US Securities Exchange Act of 1934, as a
Slide 3: Use of non-GAAP financial measures
Use of non-GAAP financial measures With respect to each non-GAAP financial measure Hydro and Statoil use in connection with their financial reporting and other public communications, Hydro and Statoil provide a presentation of what Hydro and Statoil believe to be the most directly comparable GAAP fi
Slide 4: Introduction
Introduction Jannik Lindbæk Jan Reinås Chairman Statoil ASA Chairman Norsk Hydro ASA
Slide 5: A historic transaction
A historic transaction • Merging Hydro’s oil and gas activities with Statoil to create a new Norwegian-based international energy company, capitalizing on 40 years of oil and gas expertise • Hydro to continue a century of industrial heritage as a focused aluminium company 5
Slide 6: Transaction structure and governance
Transaction structure and governance • Valuation – Merger of equals and exchange ratio based on relative contributions – Hydro’s shareholders will hold 32.7% and Statoil’s shareholders will hold 67.3% of the equity in the combined company – Government stake in the combined company will be 62.5% and
Slide 7: Eivind Reiten President & CEO Hydro
Eivind Reiten President & CEO Hydro
Slide 8: Creating two Norwegian-based global champions
Creating two Norwegian-based global champions • A leading international energy company positioned for continued growth – World’s largest offshore operator with strong portfolio – First-class technology and project execution capabilities – Major and reliable supplier of gas to Europe • A focused glob
Slide 9: A perfect match
A perfect match • Stronger basis for value creation on the Norwegian Continental Shelf • Forceful international competitor • Scale, portfolio and capabilities to accelerate growth • Strong platform to enhance shareholder value • Responding to a changing competitive landscape 9
Slide 10: Hydro: A focused global aluminium company
Hydro: A focused global aluminium company • Third largest listed aluminium company in the world • Restructuring nearly completed – strong results in 2006 • Well-positioned for long-term growth • Good power coverage from captive hydropower • Strong financial position 10
Slide 11: Hydro: Strategy for long-term growth
Hydro: Strategy for long-term growth • Building on a leading, global position in metal production • Pursuing new attractive opportunities in alumina and metal • Leveraging unique platform in Extrusion, Precision Tubing and Building Systems and strong position in Rolled Products 11
Slide 12: Helge Lund President & CEO Statoil
Helge Lund President & CEO Statoil
Slide 13: The Norwegian-based energy champion
The Norwegian-based energy champion • Step change in production and resource base – Expected combined production 1.9 million boepd in 2007 – 6.3 billion boe in proven reserves* • Stronger portfolio in Norway and internationally • Extensive exploration program and acreage • Technology and project exe
Slide 14: World's largest offshore operator
World’s largest offshore operator 0 500000 1000000 1500000 2000000 2500000 3000000 NEW COMPANY SHELL PETROBRAS BP EXXONMOBIL WOODSIDE CHEVRONTEXACO TOTAL ENI AMERADA HESS CONOCOPHILLIPS CNOOC * No. of barrels operated at water depths > 100m Source: McKinsey 2003 14
Slide 15: Taking the NCS to the next level
Taking the NCS to the next level • Ensure maximum recovery of resources • Efficient operations to prolong the economic life of existing fields • Catalyst for innovative solutions and increased recovery • Active frontier exploration 15
Slide 16: Stronger global E&P presence
Stronger global E&P presence Arctic North Sea & Norwegian Sea Russia Canada Caspian North US Gulf of Africa Mexico Middle East South America West Africa Current production 16
Slide 17: Gulf of Mexico – more of the perfect match
Gulf of Mexico – more of the perfect match • Balanced and material position with potential to deliver significant future growth – Current production in period of high prices – Significant near-term growth from new deepwater developments – Well positioned in recent significant discoveries – Top ten e
Slide 18: Significant and attractive sources of growth
Significant and attractive sources of growth* • Comprehensive portfolio of projects under development – Norway: Ormen Lange, Snøhvit, Statfjord Late Life, Gjøa/Vega, Tyrihans, Volve – US Gulf of Mexico: Tahiti, Thunder Hawk, Independence Hub Area – West Africa: Rosa, Agbami, Gimboa – Caspian: ACG ph
Slide 19: Capitalizing on technology leadership
Capitalizing on technology leadership • World leader in subsea technology • Pioneer in advanced drilling and multilateral wells • Excellent reservoir management and enhanced recovery track record • First-class project management of large scale oil and gas projects • High standard of environmental te
Slide 20: Synergies and value creation
Synergies and value creation • A merger for new opportunities and growth • Complementary competencies and portfolios • Larger operational and financial flexibility • Efficient use of technology, development expertise and R&D • Sharing of best practice 20
Slide 21: Corporate Management in the new company
Corporate Management in the new company • Helge Lund, President and Chief Executive Officer • Eldar Sætre, Chief Financial Officer • Tore Torvund, Exploration & Production Norway • Petter Mellbye, International Exploration & Production • Morten Ruud, Projects • Margareth Øvrum, Technology and New En
Slide 22: Integration process
Integration process • Company address in Stavanger. Group functions located in Oslo and Stavanger. President and CEO to operate out of both locations • Integration team to be led by Hilde Merete Aasheim • Planning and execution of integration according to detailed timeline • Equal job opportunities
Slide 23: Transaction structure and financial highlights
Transaction structure and financial highlights • Hydro’s shareholders will hold 32.7% and Statoil’s shareholders will hold 67.3% of the equity in the combined company • Hydro’s shareholders will receive shares in the ratio of 0.8622 shares per Hydro share • Net interest bearing debt expected at the
Slide 24: Timeline to closing
Timeline to closing • Transaction is subject to – Shareholder approvals – Regulatory approvals • Expected closing third quarter 2007 24
Slide 25: Income Statements
Income Statements STATOIL CONSOLIDATED STATEMENTS OF INCOME - USGAAP (Unaudited) At September 30, PROPOSED DEMERGED HYDRO CONDENSED CONSOLIDATED STATEMENT OF INCOME - USGAAP (Unaudited) At September 30, Cin NOK million) 2006 Total revenues 321 431 Total expenses before financial items -230 609 Net f
Slide 26: Balance Sheets
Balance Sheets STATOIL CONSOLIDATED BALANCE SHEET (Unaudited) At September 30, PROPOSED DEMERGED HYDRO CONDENSED CONSOLIDATED BALANCE (Unaudited) At September 30, Cin NOK million) 2006 Cin NOK million) 2006 ASSETS ASSETS Total current assets 106 732 Total current assets 45 000 Investments in affilia