Home Fossil Energy Harbour Energy getting its hands on Wintershall Dea’s E&P portfolio, bar Russian one, for $11.2 billion
Big News: Harbour Energy is Acquiring Wintershall Dea for $11.2 Billion
Courtesy of Harbour Energy
LONDON – The London-listed oil and gas company Harbour Energy has set the wheels into motion to acquire Wintershall Dea’s upstream business assets, aside from the ones in Russia, for $11.2 billion, thanks to an agreement with the German energy player’s shareholders, BASF and LetterOne. This acquisition will enrich Harbour’s portfolio with E&P assets in Norway, Germany, Denmark, Argentina, Mexico, Egypt, Libya, and Algeria as well as carbon capture and storage (CCS) licenses in Europe.
BASF and LetterOne have signed a business combination agreement with Harbour Energy to transfer Wintershall Dea’s E&P business consisting of its producing and development assets as well as exploration rights in Norway, Argentina, Germany, Mexico, Algeria, Libya, Egypt, and Denmark, excluding Ravn, as well as carbon capture and storage licenses to the London-listed firm. All of Wintershall Dea’s assets located in Russia or held in joint ventures with Russian companies are excluded from the acquisition as is the stake in WIGA Transport Beteiligungs-GmbH & Co.
In exchange for the E&P assets, the shareholders of Wintershall Dea – BASF (72.7%) and LetterOne (27.3%) – will receive total cash consideration of $2.15 billion (BASF share: $1.56 billion) and new shares equating to a total shareholding in the enlarged Harbour of 54.5%, with BASF holding 39.6% and LetterOne owning 14.9% shares at closing. The agreed enterprise value for the Wintershall Dea assets amounts to $11.2 billion, including the outstanding bonds of the German energy giant with a nominal value of around $4.9 billion that will be transferred to Harbour at closing.
Dr. Dirk Elvermann, Chief Financial Officer of BASF, underlined: “In addition to the cash component, the shares in Harbour that BASF will receive upon completion of the transaction offer significant potential for value creation and allow for a gradual and optimized exit from the oil and gas business over the next few years.”
After closing, the transaction creates optionality for monetization of BASF’s stake in the combined company, as Harbour is listed on the London Stock Exchange. As Wintershall Dea’s headquarters and the related staff are not part of the transaction, this will require further restructuring and ultimately the closure of the headquarters’ units in Kassel and Hamburg which currently have around 850 employees.
Boosting Harbour’s gas arsenal
Harbor Energy, which intends to take on some employees from the current headquarters into the combined company, explains that the acquisition of Wintershall Dea’s assets will transform it into one of the world’s largest and most geographically diverse independent oil and gas companies, adding material gas-weighted portfolios in Norway and Argentina and complementary growth projects in Mexico while enabling it to reap the benefits from an increased reserve life and improved margins with lower operating costs and greenhouse gas (GHG) intensity.
Linda Z Cook, CEO of Harbour, commented: “Today’s announcement marks Harbour’s fourth major acquisition and the most transformational step yet in our journey to build a uniquely positioned,
