1680
Canada Co. to Buy Texas Oil for $7.1b
World Economy

Canada Co. to Buy Texas Oil for $7.1b

Canadian energy company Encana said it has agreed to buy Texas’s Athlon Energy for $7.1 billion, in a bid boost the Calgary-based natural gas producer’s shift into oil.

Encana would pay $5.93 billion in cash for the company, as well as assume $1.15 billion of Athlon’s debt.
The proposed price, $58.50 a share, is 25% higher than Athlon’s Friday closing price on the New York Stock Exchange of $46.73.
Athlon currently produces 30,000 barrels of oil equivalent per day in the Permian basin, a key oil-producing region in western Texas.
After the takeover, Encana hopes to meet its target of generating up to 75% of operating cash flow from liquids production, including oil and natural gas liquids, next year instead of 2017.
 Shifting Priorities
Encana started as a natural gas producer but it has been shifting its priorities toward oil as the North American gas market has become saturated with the boom in shale gas.
“This transformative acquisition further accelerates our strategy and provides us with a prime position in what is widely acknowledged as one of North America’s top oil plays,” says Encana chief Doug Suttles.
The company said it sees potential for another 5,000 oil wells in the Permian basin, which could produce up the three billion barrels of oil equivalent.
According to the terms of the agreement, shareholders will have 20 trading days in October to decide whether to sell their shares to Encana at the deal price, and the acquisition should be completed by the end of the year.
Encana also said Athlon executives and the structures linked to Apollo investment fund have already pledged to sell their shares, which represent a total of 35.8% of the company.

 

Short URL : http://goo.gl/ukoiXZ

You can also read ...

Thai CB Retains Key Rate
Thailand’s central bank on Wednesday left its key interest...
China and India continue to remain the most promising investment destinations in 2017.
Developing Asia is expected to witness a 15% increase in...
Brazil Raises Deficit Ceiling
Brazil is raising its deficit ceiling for this year and 2018...
Elon Musk, Kevin Plank, Bob Iger, Richard Trumka, Kenneth Carleton Frazier
The honeymoon is definitely over. When US President Donald...
Riksbank is under pressure to tighten its ultra-loose monetary policy.
Underlying inflation topped the Swedish central bank’s target...
At 310% GDP, China’s banking sector is above the advanced economy average and nearly three times  the emerging market average.
China's economy is looking good enough that the International...
Crude oil accounts for 96% of exports and around half of state revenue.
Venezuela might look bad right now amid protests, scarce food...
US Household Debt at $12.8 Trillion
US household debt reached a new record in the second quarter,...

Trending

Googleplus