BASF signs oil merger deal with Russian tycoon's firm

News Image

MG News | September 28, 2018 at 03:39 PM GMT+05:00

0:00

September 28, 2018: German chemicals giant BASF has signed an agreement to merge its Wintershall oil and gas unit with the DEA energy firm owned by Russia's billionaire entrepreneur Mikhail Fridman.

According to the company, the deal will create a leading independent European oil and gas company.

BASF said it would initially hold 67 percent of shares in the joint venture, which will go by the name Wintershall DEA.

The remaining shares will be held by the LetterOne group, Fridman's Luxembourg-based investment group which owns DEA.

The transaction, which still needs to be approved by regulators, is expected to close in the first half of 2019.

There are plans for the new entity to be listed on the stock exchange "in the medium term", BASF said.

As a result of the deal, BASF lowered its outlook for 2018. The group now expects earnings before interest and taxes to "decline considerably" in the previous year, compared with an earlier estimate of "a slight decline".

In 2017, the two businesses had combined sales of 4.7 billion euros ($5.4 billion) and net profits of 740 million, the statement added.

They expect the tie-up to lead to savings of "at least" 200 million euros a year.

The merged company will aim for a daily production of 750,000 to 800,000 barrels of oil equivalent between 2021 and 2023.

LetterOne purchased DEA, which specializes in oil and gas exploration and production, from German energy group RWE in 2015 for 5.1 billion euros.

At the time, BASF was also believed to be interested in snapping up the division.

Wintershall DEA will be headquartered in the German cities of Kassel and Hamburg, where the two separate companies are currently based.

APP

Related News

Name Price/Vol %Chg/NChg
KSE100 138,412.25
167.69M
0.32%
447.43
ALLSHR 85,702.96
423.92M
0.15%
131.52
KSE30 42,254.84
82.09M
0.43%
180.24
KMI30 194,109.59
84.37M
0.15%
281.36
KMIALLSHR 56,713.67
217.03M
0.03%
16.37
BKTi 37,831.34
13.04M
1.62%
603.62
OGTi 27,440.63
3.93M
-0.09%
-23.70
Symbol Bid/Ask High/Low
Name Last High/Low Chg/%Chg
BITCOIN FUTURES 118,335.00 118,355.00
117,905.00
715.00
0.61%
BRENT CRUDE 73.47 73.63
71.75
0.96
1.32%
RICHARDS BAY COAL MONTHLY 96.50 0.00
0.00
2.20
2.33%
ROTTERDAM COAL MONTHLY 104.50 104.50
104.50
-0.30
-0.29%
USD RBD PALM OLEIN 998.50 998.50
998.50
0.00
0.00%
CRUDE OIL - WTI 70.26 70.33
70.18
0.26
0.37%
SUGAR #11 WORLD 16.46 16.58
16.37
-0.13
-0.78%

Chart of the Day


Latest News

Top 5 things to watch in this week

Pakistan Stock Movers
Name Last Chg/%Chg
Name Last Chg/%Chg