Brooge Energy Signs $884M Conditional Sale Agreement With Gulf Navigation For 100% Of BPGIC Group, To Be Paid via $125.3M in Cash, $122M In Consideration Shares, And $636M In Mandatory Convertible Bonds, All Subject To 12-Month Lock-Up

Brooge Energy Limited, ("BEL") (NASDAQ:BROG), a Cayman Islands-based infrastructure provider, which is engaged in Clean Petroleum Products and Biofuels and Crude Oil storage and related services, today announced entering into a conditional sale and purchase agreement (the "Acquisition Agreement") for the proposed sale of 100% of the total issued share capital of each of Brooge Petroleum and Gas Investments Company FZE ("BPGIC FZE") and Brooge Petroleum and Gas Investment Company Phase III FZE ("BPGIC Phase III FZE", collectively with their subsidiaries referred to as the "BPGIC Group"), to Gulf Navigation Holding PJSC ("GulfNav") (the "Transaction").

Key highlights:  This acquisition is part of GulfNav's long-term vision to become a key player in the energy sector by expanding its storage and logistics capabilities with BPGIC Group's state-of-the-art infrastructure, which includes advanced facilities for the storage of fuel oil, crude oil, and petroleum products. These assets will complement GulfNav's existing operations and allow them to provide an integrated storage and transportation solution. The integration of the two businesses is expected to drive operational efficiencies, enhance service offerings, and create substantial value for stakeholders.

BEL's Board of Directors commented, "We are pleased to be nearing the closing of our strategic transaction with GulfNav. After careful diligence by both parties, we have outlined the proposed terms and conditions the Board believes is in the best interest of ensuring long-term value creation for our shareholders."

Principal Terms and Conditions of the Acquisition Agreement

Consideration Structure

The total consideration (the "Consideration") payable under the Transaction amounts to c. USD 884 million (AED 3,245,000,000). This Consideration will be satisfied through the following means:

1. Cash Consideration: c. USD 125.3 million (AED 460,000,000) in cash, which will be paid as follows:
2.  
   1. c. USD 65 million (AED 239,650,000) will be paid into the Completion Escrow Account (subject to any deductions of transaction expenses and for known leakage (if any)); and
3.  
   1. c. USD 60 million (AED 220,350,000) will be paid into an escrow account for the benefit of ASMA Capital Partners B.S.C.(c) ("ASMA") in connection with the settlement of certain outstanding liabilities of BPGIC Holdings Limited (under liquidation) to ASMA's subsidiary, MENA Energy Services Holdings Limited, in order to facilitate the conclusion of the Transaction.
4. Consideration Shares: The allotment and issue on completion of 358,841,476 ordinary shares in the share capital of GulfNav, credited as fully paid, at a price of USD 0.34 (AED 1.25) per share, with a total subscription price of c. USD 122 million (AED 449 million).    
5. Mandatory Convertible Bonds: c. USD 636 million (AED 2,336 million) to be satisfied by the issue by GulfNav on completion of Mandatory Convertible Bonds, which will convert into ordinary shares in the share capital of GulfNav in accordance with the terms of such Mandatory Convertible Bonds. The Mandatory Convertible Bonds (upon their conversion into shares in GulfNav) will entitle the holder to the same economic benefits as the Consideration Shares.

The Consideration Shares and any Mandatory Convertible Bonds which will convert into shares in the share capital of GulfNav will be subject to a 12-month lock-up period from their date of issuance or conversion, as the case may be.

The Consideration is expected to be distributed by way of dividend at an appropriate time following completion.