BASF, LetterOne Sign Letter of Intent to Merge Oil-and-Gas Arms
08 December 2017 - 06:49PM
Dow Jones News
By Nathan Allen
Germany's BASF SE (BAS.XE) said Thursday that it has signed a
letter of intent with LetterOne Group to merge their respective
oil-and-gas subsidiaries, Wintershall AG and DEA.
The new venture will be one of Europe's largest independent
exploration and production companies, according to BASF, which
envisages a public listing in the medium term.
BASF would initially retain 67% of the shares in the merged
entity--which would operate under the name Wintershall DEA--while
LetterOne would control the remaining 33%. However, BASF said that
it plans to increase its shareholding to reflect the value of
Wintershall's gas-transportation business, which is not accounted
for in the initial ratio.
The chemicals company said that it would appoint the entity's
chief executive officer, with LetterOne naming its deputy, and that
the business would be based in the German cities of Kassel and
Hamburg.
The deal should close in the second half of 2018, pending
regulatory approval, BASF said.
In 2016, the combined business would have had pro-forma sales of
4.3 billion euros ($5.06 billion), and net income of EUR326
million. Total production would have been 590,000 barrels of oil
equivalent a day, according to BASF.
LetterOne is a private Luxembourg-based investment vehicle
controlled by Russian magnate Mikhail Fridman. It acquired DEA in
March 2015 from RWE AG (RWE.XE).
Write to Nathan Allen at nathan.allen@dowjones.com
(END) Dow Jones Newswires
December 08, 2017 02:34 ET (07:34 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
BASF (QX) (USOTC:BASFY)
Historical Stock Chart
From Feb 2024 to Mar 2024
BASF (QX) (USOTC:BASFY)
Historical Stock Chart
From Mar 2023 to Mar 2024