EMGS: Non-binding term sheet for asset transaction

Core Viewpoint - The company, Electromagnetic Geoservices ASA (EMGS), is pursuing a transaction to transfer its business operations and assets to an undisclosed buyer as part of a strategic review to safeguard stakeholder interests [2][5]. Group 1: Transaction Details - EMGS has signed a non-binding term sheet with a third-party buyer for the acquisition of its business operations, including hardware, intellectual property rights, contractual positions, and all employees [2]. - The transaction structure involves transferring the EM Business to a subsidiary (NewCo) before ownership is transferred to the buyer [3]. - The purchase price for the EM Business is expected to be significantly below the outstanding debt under the convertible bond issue EMGS03, indicating that EMGS will not retain substantial assets post-transaction [4]. Group 2: Strategic Review and Alternatives - The strategic review conducted by EMGS over several months concluded that the transaction represents the best available alternative to protect the interests of stakeholders, as other options like restructuring or winding down operations were deemed unviable [5]. - The buyer will commence a due diligence review of the EM Business, although there are no guarantees that a binding agreement will be reached or that the transaction will be completed [6]. Group 3: Operational Context - EMGS is a leader in the marine electromagnetic market, utilizing proprietary technology to assist oil and gas companies in offshore hydrocarbon exploration, enhancing efficiency and reducing costs [8].