(Alliance News) - Premier Oil PLC said Tuesday it has agreed a merger with Harbour Energy's UK operating company, Chrysaor Holdings Ltd.
Premier Oil shares rose 8.6% after agreeing the all-share merger to 16.49 pence in London on Tuesday morning.
The oil and gas company has its registered office in Edinburgh and has operations in a number of countries including Mexico, the UK, Vietnam, and Brazil. It will merge with Chrysaor through a reverse takeover, retaining a London listing.
Premier Oil stakeholders are expected to own up to 23% of the combined group - comprising Premier shareholders owning up to 5.45% and existing creditors holding the balance - and Chrysaor shareholders owning at least 77%.
Combined, the business would have production as at June 30 of more than 250,000 barrels of oil equivalent per day and combined proved and probable reserves as at 2019 end of 727 million barrels of oil equivalent.
Revenue for the combined business in the first half of 2020 would have amounted to USD1.76 billion with earnings before interest, tax, depreciation, amortization and exploration of USD1.27 billion.
The combined board will have 11 directors. These will include Linda Cook, current Harbour chief executive, who will be CEO of the combined group. Chrysaor's CEO, Phil Kirk, will be president of the combined group and CEO of Europe.
The deal is subject to regulatory approval, as well as approval from Premier's shareholders and existing creditors.
"There is significant industrial, commercial and financial logic to creating an independent oil and gas company of this size with a leading position in the UK North Sea. The transaction will also provide the combined group with a solid foundation from which to pursue a fully funded international growth strategy," said Premier CEO Tony Durrant.
By Anna Farley; annafarley@alliancenews.com
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