CGG Confirms Technip's Approach For Potential Combination; Stock Climbs - Update

(RTTNews) - Shares of CGG SA (CGG), formerly Compagnie Generale de Geophysique-Veritas, climbed around 22 percent in the morning trading in Paris after the French geoscience company confirmed Thursday that it has been approached by French oilfield services provider Technip (TNHPF.PK, TKPPY.PK) in an unsolicited manner in respect of a potential combination. Meanwhile, Technip shares were losing around 5 percent in Paris.

In its statement, CGG said it has considered that the conditions to pursue were not met.

Responding to information released in the press, Technip also announced that it approached CGG on Monday, November 10, to create a first tier oil and gas services provider. According to the firm, the proposed transaction would take the form of a public tender offer in cash for CGG's shares at a price of 8.30 euros per share.

Technip said it would like to enter into a constructive dialogue with CGG's Board of Directors concerning its project that provides a strong strategic and industrial logic. According to the firm, this industrial logic involves the integration and development of CGG's reservoir and data processing and seismic equipment activities within Technip.

As part of this project, Technip would reinforce and then separate the Acquisition Division of CGG. Technip expects this business to become a sustainable leader in a sector that has its own characteristics.

Technip said it is confident that its project can be completed under conditions that create value for its shareholders, while maintaining a strong balance sheet and its current credit rating.

The company added that it is unable to indicate at this stage whether such transaction will occur.

In Paris, CGG shares were gaining 21.73 percent, and trading at 7.93 euros. Following the media report about the approach, CGG shares gained 22.67 percent on the NYSE on Wednesday to settle at $10.55.

Meanwhile, Technip shares were losing 5.04 percent, and trading at 57.80 euros.