History
Veritas DGC, a Houston seismic services contractor, abandoned a merger with PGS in 2002, then agreed in 2006 to be acquired by France's CGG for about $3.1 billion.
2001-2002: The PGS merger that failed
Veritas DGC was a Houston-based seismic and geophysical services contractor to the oil and gas industry. In November 2001 it agreed to combine with Norway's Petroleum Geo-Services (PGS) in a "merger of equals", under a new Cayman Islands holding company. PGS shareholders were to receive 0.47 new shares per PGS share, while Veritas holders converted one-for-one. The deal still needed shareholder votes and antitrust clearance.
The terms moved in Veritas's favour. In April 2002 the SEC agreed Veritas would be the accounting acquirer under revised terms: PGS's ratio was cut to 0.40, Veritas holders would own 44% of the new company, and they would hold a 6-4 board majority, with Veritas's own CEO and CFO running it. On July 30, 2002 Veritas's board withdrew its approval and recommendation, and the merger agreement was terminated on July 31, 2002.
2003-2006: Restatement and refinancing
The record for these years is thin. In December 2003 shareholders approved an employee stock option exchange program, though the record does not show whether it was ever carried out. In October 2004 Veritas delayed its fiscal 2004 annual report because of a financial restatement, which was still pending in March 2005. That month it raised its top executives' base salaries, including CEO Thierry Pilenko's, to $475,000, and agreed to reimburse up to $30,000 in legal fees that Pilenko and CFO Mark Baldwin incurred obtaining personal advice on the restatement.
In February 2006 it signed a new five-year, $85 million revolving credit facility covering the US, Canada, Singapore and the UK. Wells Fargo led it, and it was secured by receivables, subsidiary stock and the company's US seismic land-data library.
2006-2007: Sale to CGG
On September 4, 2006 France's Compagnie Générale de Géophysique (CGG) agreed to acquire Veritas in a deal valued at about $3.1 billion, roughly 51% in CGG stock and 49% in cash. Shareholders could choose $75.00 in cash or 2.2501 CGG American Depositary Shares per share. Veritas amended its poison pill so the deal would not trigger it.
The definitive proxy statement of December 1, 2006 called a shareholder vote for January 9, 2007. Elections were subject to proration, CGG would issue up to about 49.8 million ADSs and pay about $1.6 billion in cash, and former Veritas holders would own about 36% of CGG. The board unanimously recommended approval, and a majority of shares outstanding on November 18, 2006 was required.
On January 12, 2007 the company, now CGG Holding (U.S.) Inc., ended the registration of a class of its securities, and on January 30, 2007 its exchange filed to remove a class from listing.
Written from the 9 story beats below (2001 to 30 Jan 2007), which come from the company's own announcements and filings.