Valleres' $2B move for Kurdistan assets marks month's largest deal

Deals in the 30-day period from mid-August to mid-September picked up from last month when only a handful of US and global energy M&A transactions were reported.

In the largest US deal, Venoco Inc. said Aug. 29 that it had received a non-binding proposal from Timothy M. Marquez, chairman and CEO of the company, to take the Denver-based company private. Marquez is looking to acquire the 49.7% he does not already own, "putting a lot of faith in the 214,000 acres the company owns in the emerging liquids-rich Monterey Shale play," noted Evaluate Energy analyst Mark Young. The offer is substantial at around $728 million. The $12.50 per share offer represents a premium of 39% on the day-prior share price, but the price has fallen from much higher levels of around $14 only a month previously, noted Young. "Having said that, the deal seems to give the shareholders a fair price for current operations, with the reserve life multiple roughly equalling the operating cash flow multiple," he concluded. The offer is contingent on Marquez obtaining financing on acceptable terms. The offer, while most likely financeable according to an August 29 research note by Jefferies & Co. Inc., may not be enough, the analysts continued. Jefferies estimates Venoco's proved-only value at $11-$12/share (based on YE12 estimated reserves and $85 oil), including an estimated $200 million proceeds for the sale of its interest in the Hastings field to Denbury Resources in February 2009. According to Jefferies analysts, the current offer "does not seem to include significant credit for the company's Monterey Shale exploration program," noting its current price of $16 includes $4-$5/share of potential Monterey value.

Another large US deal came as QR Energy acquired a portfolio of assets for $577 million from its sponsor Quantum Resources Fund. The assets are located in the Permian Basin, Ark-La-Tex and Mid Continent regions. "The assets acquired are 59% weighted towards gas, which in the current environment makes the acquisition metrics slightly above the typical US gas weighted acquisition. However, the terms of the consideration are compensated by the fact that the bulk of the acquisition is composed of preferred shares, issued at a par value 18% higher than the prior day's common share price and at a coupon rate of just 4%," noted Evaluate Energy analyst Eoin Coyne.

In the largest deal of the 30-day period, Vallares announced a $2.1 billion reverse takeover of Turkish company Genel Energy International Ltd. With production around 41,000 boe/d, Genel is the largest producer in the Kurdistan region. The deal also represents a triumph for Genel, noted Young, as it will gain 50% of the combined company, a listing on the FTSE, cash to fund a ramp-up in production to 90,000 boe/d by 2013, and a new management structure.

More Oil & Gas Financial Journal Current Issue Articles
More Oil & Gas Financial Journal Archives Issue Articles
View Oil and Gas Articles on PennEnergy.com

Related Articles

Oryx enters Permian with $300M equity commitment

04/09/2014 Oryx Midstream Services LLC has received an equity commitment totaling up to $300 million, and will pursue midstream opportunities in the Permian Basin, focusing initially on the Delaware Basin in ...

Outrigger Energy further expands Permian footprint

04/09/2014 Outrigger Energy LLC is expanding its midstream capabilities in the Permian Basin with the addition of a natural gas gathering and processing and crude oil gathering system in the Midland Basin of ...

Energen sells natural gas utility to become a pure play in the E&P space

04/07/2014

Energen Corp. has signed a definitive stock purchase agreement to sell its natural gas utility business, Alabama Gas Corp. (Alagasco), to The Laclede Group Inc.

Welch appointed EVP, CFO of JP Energy Partners

04/03/2014

JP Energy Partners LP has appointed Patrick Welch as the company’s executive vice president and CFO. Welch has been serving as the interim CFO for the company since November of last year.

Rosetta Resources increases borrowing base to $950 million

04/03/2014 Rosetta Resources Inc. reports the amendment of its senior revolving credit facility to increase its borrowing base. Effective April 2, the company's borrowing base increased from $800 million to $...

More Oil & Gas Financial Articles

Oryx enters Permian with $300M equity commitment

Wed, Apr 9, 2014

Oryx Midstream Services LLC has received an equity commitment totaling up to $300 million, and will pursue midstream opportunities in the Permian Basin, focusing initially on the Delaware Basin in Texas and New Mexico.

Outrigger Energy further expands Permian footprint

Wed, Apr 9, 2014

Outrigger Energy LLC is expanding its midstream capabilities in the Permian Basin with the addition of a natural gas gathering and processing and crude oil gathering system in the Midland Basin of West Texas.

Energen sells natural gas utility to become a pure play in the E&P space

Mon, Apr 7, 2014

Energen Corp. has signed a definitive stock purchase agreement to sell its natural gas utility business, Alabama Gas Corp. (Alagasco), to The Laclede Group Inc.

Welch appointed EVP, CFO of JP Energy Partners

Thu, Apr 3, 2014

JP Energy Partners LP has appointed Patrick Welch as the company’s executive vice president and CFO. Welch has been serving as the interim CFO for the company since November of last year.

Rosetta Resources increases borrowing base to $950 million

Thu, Apr 3, 2014

Rosetta Resources Inc. reports the amendment of its senior revolving credit facility to increase its borrowing base. Effective April 2, the company's borrowing base increased from $800 million to $950 million.

Most Popular

Oil & Gas Jobs

Search More Job Listings >>
Subscribe to OGFJ