MOSCOW (MRC) - Spanish oil company Repsol said it had reached a deal to buy Talisman Energy, Canada's fifth-largest independent oil producer, for USD13 billion, said Reuters.
The proposed acquisition will boost Repsol's exploration and production arm and fill a funding gap after the seizure of its Argentine business in 2012. It will also help to reduce the firm's reliance on high-risk oil producing areas such as Libya.
The oil price drop has lowered price tags on producers like Talisman, spurring interest from Repsol which has been on the search for oil and gas targets in North America or other countries with stable regulation.
The Spanish company said the acquisition would boost its oil production by 76% to 680,000 barrels per day while its reserves would increase 55%. It also said the acquisition would bring annual benefits worth USD220 million and would be neutral for its earnings in 2016 and become accretive in 2017.
The board of Talisman has approved the transaction and recommended shareholders accept it, Repsol said in a statement to Spain's stock market regulator.
Previous merger talks between the two companies broke down last summer because of Talisman's underperforming North Sea operations, much of which are in a joint venture with China's Sinopec.
As MRC informed earlier, in June 2014, Mexico's national oil company Pemex announced that it would sell a 7.9% stake in Spanish oil firm Repsol, worth about 2.2 billion euros (USD3.0 billion). The sale ends a long relationship between Pemex and Repsol that had run into trouble in recent years over disagreements on policies ranging from top management to the handling of Repsol's investments in Argentina.
Repsol S.A is an integrated Spanish oil and gas company with operations in 28 countries. The bulk of its assets are located in Spain.
MRC