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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K/A No. 1
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) January 4, 1994
SEAGULL ENERGY CORPORATION
______________________________________________________________________________
(Exact name of registrant as specified in its charter)
Texas
______________________________________________________________________________
(State or other jurisdiction of incorporation)
1-8094 74-1764876
___________________________________ ________________________________________
(Commission File Number) (IRS Employer Identification No.)
1001 Fannin, Suite 1700, Houston, Texas 77002-6714
______________________________________________________________________________
(Address of principal executive offices) (Zip Code)
(713) 951-4700
______________________________________________________________________________
Registrant's telephone number, including area code
Not Applicable
______________________________________________________________________________
(Former name or former address, if changed since last report.)
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statement of Business Acquired.
See exhibits for historical financial statements of Novalta Resources Inc.
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(b) Pro Forma Financial Information.
UNAUDITED PRO FORMA CONDENSED FINANCIAL STATEMENT
On January 4, 1994, an indirect wholly owned subsidiary of Seagull Energy
Corporation ("Seagull" or the "Company") acquired all of the outstanding shares
of stock (the "Stock") of Novalta Resources Inc. ("Novalta") and an
intercompany note (the "Note") from Novalta to its parent, Novacor
Petrochemicals Ltd. ("Novacor Petrochemicals"). The Stock and the Note were
acquired for a purchase price of approximately $203 million in cash, subject to
customary post-closing adjustments (the "Seagull Canada Acquisition"). As of
February 1, 1994, the adjusted purchase price was estimated at $200.5 million.
The economic effective date of the Seagull Canada Acquisition was December 31,
1993 (the "Effective Date"). Effective as of the January 4, 1994 Closing Date,
Novalta was amalgamated with one of its subsidiaries along with Seagull Energy
Canada Ltd., the indirect subsidiary of Seagull that acquired Novalta. The
resulting amalgamated company was named Seagull Energy Canada Ltd. ("Seagull
Canada").
The unaudited pro forma condensed balance sheet as of December 31, 1993 and
the unaudited pro forma condensed statement of earnings for the year ended
December 31, 1993 give effect to the Seagull Canada Acquisition, financed
initially under a new $175 million reducing revolving credit facility (the
"Canadian Credit Agreement") as well as borrowings under Seagull's amended
and restated $475 millon revolving credit line (the "Revolver") with a group of
major U.S. and international banks.
The following unaudited pro forma information has been included as required by
the rules of the Securities and Exchange Commission and is provided for
comparative purposes only. The unaudited pro forma information presented is
based on the respective historical consolidated financial statements of Seagull
and Novalta and should be read in conjunction with such financial statements
and the related notes thereto. The historical consolidated financial statements
of Novalta as presented do not reflect the effect of certain transactions
between Novalta and NOVA Corporation of Alberta and its subsidiaries that were
completed prior to the closing of the Seagull Canada Acquisition, such as the
elimination of intercompany debt balances. The effect of such transactions are
reflected in the conforming adjustments to the pro forma unaudited condensed
financial statements. The unaudited pro forma information presented does not
purport to be indicative of actual results, if the combinations had been in
effect on the dates or for the periods indicated, or of future results.
All amounts are in U.S. dollars.
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UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
As of December 31, 1993
(in thousands)
Seagull Novalta
Energy Resources Conforming Pro Forma
Corporation Inc. Adjustments Combined
----------- --------- ----------- ---------
ASSETS
Current Assets:
Cash and cash equivalents................ $ 5,572 $ 415 $ -- $ 5,987
Accounts received, net................... 98,734 11,136 -- 109,870
Other.................................... 10,902 688 -- 11,590
---------- -------- -------- ----------
Total.................................. 115,208 12,239 -- 127,447
Property, Plant and Equipment -- at cost... 1,278,701 166,067 (166,067)(A) 1,495,295
216,229 (C)
365 (C)
Accumulated Depreciation, Depletion
and Amortization........................ 345,512 69,038 (69,038)(A) 345,512
---------- -------- -------- ----------
933,189 97,029 119,565 1,149,783
Other Assets.............................. 69,854 3,145 883 (C) 65,424
(8,458)(D)
---------- -------- -------- ----------
Total Assets.............................. $1,118,251 $112,413 $111,990 $1,342,654
========== ======== ======== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable........................ $ 84,904 $ 7,060 $ -- $ 91,964
Current maturities of long-term debt.... 1,538 -- -- 1,538
Other................................... 37,724 746 -- 38,470
---------- -------- -------- ----------
Total Current Liabilities........... 124,166 7,806 -- 131,972
Long-Term Debt............................ 459,787 64,316 (64,316)(B) 653,093
193,306 (D)
Other Noncurrent Liabilities.............. 66,785 1,965 (602)(C) 68,148
Deferred Income Taxes..................... 28,134 7,899 (7,899)(B) 50,062
21,928 (C)
Shareholder's Equity...................... 439,379 30,427 (30,427)(B) 439,379
---------- -------- -------- ----------
Total Liabilities and
Shareholders' Equity.................... $1,118,251 $112,413 $111,990 $1,342,654
========== ======== ======== ==========
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NOTES TO UNAUDITED PRO FORMA
CONDENSED BALANCE SHEET
(A) To eliminate Novalta's historical cost of property, plant and equipment
and accumulated depreciation, depletion and amortization.
(B) To eliminate the long-term debt, deferred income taxes and shareholder's
equity of Novalta.
(C) To adjust the assets acquired and liabilities assumed in the Seagull
Canada Acquisition to reflect the allocation of the estimated purchase
price. The adjusted cost of property, plant and equipment was calculated
as follows:
(in thousands)
Estimated purchase price.......................... $200,455
Estimated transaction costs....................... 1,309
Less -- other assets acquired:
Current assets............................... (12,239)
Investment in EBOC Energy Ltd. .............. (3,255)
Deferred debt costs.......................... (773)
Other fixed assets........................... (365)
Plus -- liabilities assumed:
Current liabilities.......................... 7,806
Deferred credits............................. 1,363
Deferred income taxes........................ 21,928
--------
$216,229
========
The purchase price was determined pursuant to arm's length negotiations
between the Company and Novacor Petrochemicals, based on the economic
effective date of December 31, 1993. The purchase price was based
to a large extent on the net present value of oil reserves attributable to
the properties acquired as a result of the Seagull Canada Acquisition.
(D) To record the financing of the Seagull Canada Acquisition.
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UNAUDITED PRO FORMA CONDENSED STATEMENT OF INCOME
Year Ended December 31, 1993
(in thousands)
Seagull Novalta
Energy Resources Conforming Pro Forma
Corporation Inc. Adjustments Combined
----------- --------- ----------- ---------
Revenues ....................... $377,165 $32,358 $ -- $409,523
Costs of Operations:
Operating Costs............... 184,620 12,973 399 (B) 197,992
Depreciation, depletion and
amortization................ 116,556 9,371 (9,371)(A) 131,772
15,216 (C)
-------- ------- -------- --------
Operating Profit................ 75,989 10,014 (6,244) 79,759
General and Administrative
Expense....................... 11,666 -- -- 11,666
Interest Expense................ 36,753 1,083 (1,083)(A) 48,595
11,842 (D)
Interest Income and other...... (5,708) (3,102) -- (8,810)
-------- ------- -------- --------
Earnings Before Income Taxes.... 33,278 12,033 (17,003) 28,308
Income Taxes.................... 6,080 4,650 (4,650)(A) 6,146
66 (E)
-------- ------- -------- --------
Net Earnings.................... $ 27,198 $ 7,383 $(12,419) $ 22,162
======== ======= ======== ========
Earnings Per Share.............. $ 0.76 $ 0.62
======== ========
Weighted Average Number of
Common Shares Outstanding..... 35,790 35,790
======== ========
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NOTES TO UNAUDITED PRO FORMA
CONDENSED STATEMENTS OF INCOME
(A) To eliminate depreciation, depletion and amortization, interest expense
and income taxes of Novalta.
(B) To adjust general operating expenses to give effect to Seagull's increased
personnel, rent, consultation, professional and other expenses expected
as a result of the Seagull Canada Acquisition.
(C) To adjust depreciation, depletion and amortization to give effect to the
Seagull Canada Acquisition.
(D) To adjust interest expense to give effect to the Seagull Canada
Acquisition initially financed under the Canadian Credit Agreement and
the Revolver and the amortization of loan acquisition costs relating to
the Canadian Credit Agreement. The pro forma interest expense
adjustment was calculated as follows:
(in thousands)
Pro forma average outstanding balance --
Canadian Credit Agreement $151,938
Estimated average interest rate 5.01%
--------
Pro forma interest expense on 7,612
Canadian Credit Agreement
Pro forma additional outstanding balance --
Revolver 49,826
Estimated average interest rate 5.40%
--------
Pro forma interest expense on the
additional Revolver 2,689
Pro forma interest expense on historical
Revolver due to increased interest
rate margin 1,348
Pro forma amortization of loan acquisition
costs relating to the Canadian Credit
Agreement 193
-------
$11,842
=======
(E) To adjust Revenue Canada and Alberta Province income taxes for the items
discussed in Notes (B) through (D) above.
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(c) Exhibits.
* 2.1 Consolidated Financial Statements of Novalta Resources Inc.
*24.1 Consent of Ernst & Young.
* Filed herewith.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: February 15, 1994
SEAGULL ENERGY CORPORATION
By: /s/ Rodney W. Bridges
_____________________
Rodney W. Bridges
Vice President and Controller
(Principal Accounting Officer)
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EXHIBIT INDEX
Page
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* 2.1 Consolidated Financial Statements of Novalta Resources
Inc.
*24.1 Consent of Ernst & Young.
* Filed herewith.