Maersk Oil, a Danish oil and gas company owned by the A. P. Moller-Maersk Group, is set to sell off its oil and gas division to Total for $7.45 billion. This sale is being made by A. P. Moller-Maersk Group to Total to achieve its goal in stopping all its energy related businesses and focus on being a transport and logistics group centred on the world’s largest container shipping line.
Terms of the agreement
- Maersk will receive $4.95bn in Total shares and Total will assume $2.5bn of Maersk Oil’s short term debt.
- 5 million Worth of shares will be issued by Total to A. P. Moller-Maersk Group based on the 20 business days prior to the signing date (August 21).
- The transaction is expected to close in first quarter 2018 and has an effective date of 1st July 2017.
“This transaction delivers an exceptional opportunity for Total to acquire, via an equity transaction, a company with high quality assets which are an excellent fit with many of Total’s core regions. The combination of Maersk Oil’s North Western Europe businesses with our existing portfolio will position Total as the second operator in the North Sea with strong production profiles in UK, Norway and Denmark, thus increasing exposure to conventional assets in OECD countries. Internationally, in the US Gulf of Mexico, Algeria, East Africa, Kazakhstan and Angola there is an excellent fit between Total and Maersk Oil’s businesses allowing for value accretion through commercial, operating and financial synergies.” said Patrick Pouyanne, Chairman and CEO of Total.
With the combination of the assets of Total and Maersk Oil in the North Sea, Total expects to generate a growth of more than $400 million per year.
