Kazakhstan, Astana, July 12 / Trend S.Suleymanov /
The Board of Directors of JSC KazMunaiGas Exploration Production (KMG EP or the "Company") and NC KazMunayGas JSC (NC KMG) announced on update of the market on a series of transactions between KMG EP and NC KMG, KMG EP Head Kenzhebek Ibrashev said, the company reported.
KMG EP has reached an agreement with NC KMG to acquire 50% of Kazakhoil Aktobe LLP (KOA), 51% of Kazakturkmunai Ltd ("KTM") and 50% of Mangistau Investments B.V. (MIBV), the owner of 100% of the common share capital of JSC "Mangistaumunaigas" (MMG).
For the three assets KMG EP will pay total cash consideration of $750 million, of which $350m is for the stake in Kazakhoil Aktobe (KOA), US$70m for the stake in Kazakturkmunai (KTM), and $330m for a 50% stake in Mangistau Investments B.V ("MIBV"). The cash component of acquisitions will be financed by the Company's own funds, Ibrashev said.
According to preliminary estimates, these acquisitions will result in over 27% growth in consolidated oil production of KMG EP and in an increase of 406m barrels in 2P reserves (18.5%).
The Board of Directors of KMG EP has received opinions from both Credit Suisse and Visor Capital that the consideration to be paid by the Company in the acquisition of a stake in MMG is fair to KMG EP from the financial point of view.
This transaction, subject to a number of conditions including approval by regulatory bodies, is expected to be completed in Q3 2010.
Ibrashev said this transaction is subject to a number of conditions, including approval by regulatory bodies and, pursuant to Kazakhstan's law, a written waiver signed by the remaining shareholders of KOA and KTM of their pre-emptive right and expected to be completed in Q4 2010.
NC KMG also confirms that it is considering to transfer a number of new exploration blocks to KMG EP later this year.
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