Cepsa Pays $2.2 Billion For Coastal Energy In Southeast Asia

Transaction Type
Sellers
Buyers
Announce Date
Post Date
Estimated Price
CA$2,300.0MM
Description

To buy Houston-based company including indirect stakes in E&P in the Gulf of Thailand.

Cia. Espanola de Petroleos SA (Cepsa), the Abu Dhabi-owned oil refiner, agreed to buy Coastal Energy Co. for C $2.3 billion (US $2.2 billion) as the Middle East sheikhdom adds to crude and natural-gas assets in Southeast Asia.

Cepsa, as the Madrid-based company is known, and partner Strategic Resources (Global) Ltd. agreed to pay C $19 a share, 28% more than Coastal Energy’s closing price on Nov. 18, the Houston-based company said in a statement. The venture will take on Coastal Energy’s C $51 million of net debt as part of the deal, due to close in the first quarter.

Abu Dhabi, the capital of the United Arab Emirates and holder of about 6% of global oil reserves, is boosting access to energy assets abroad through government-owned companies like International Petroleum Investment Co., Cepsa’s owner. Buying Coastal gives IPIC indirect stakes in production and exploration in the Gulf of Thailand, where a unit of Abu Dhabi’s Mubadala Development Co. also holds concessions.

“Coastal’s business comprises a high-quality portfolio of upstream assets located in Southeast Asia,” Cepsa CEO Pedro Miro said in the statement. Coastal Energy’s board unanimously backs the deal, CEO Randy Bartley said in the statement.

Citigroup Inc. and Credit Suisse Group AG are financial advisers for Coastal Energy. Goldman Sachs Group Inc. is the financial adviser for Cepsa, and PriceWaterhouseCoopers is advising both Cepsa and Strategic Resources.