Blackstone-backed Siccar Point bolts on OMV in $1bn deal

Kenny Wastell
10 November 2016

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Private-equity-backed oil exploration and production company Siccar Point Energy has agreed to wholly acquire the North Sea assets of listed Austrian corporate OMV in a deal valued at up to $1bn.

The deal comprises a $750m firm payment and another $125m subject to final approval for the sale of shares owned by oil and gas business Rosebank, in which OMV holds a 20% stake. It also includes provision for a further $125m purchase price adjustment.

Blackstone Energy Partners and Blue Water Energy joined Singapore sovereign wealth fund GIC in a $500m investment in Aberdeen-based Siccar Point in September 2014.

The business has received additional capital commitments from unnamed backers since that date, the financial details of which remain undisclosed. The company will continue to have available capital on completion of the OMV bolt-on, unquote" understands.

The deal marks the second North Sea acquisition by the business, which bought an 8.9% interest in the Greater Mariner Area from JX Nippon Exploration and Production in August 2016. It also comes three years after OMV divested many of its German operations to Carlyle- and Vitol Group-backed Varo Energy.

The OMV acquisition is expected to receive regulatory approval in Q1 of 2017. Blackstone declined to comment on debt associated with the transaction.

While exit activity within the oil and gas space has been hindered by depressed oil prices over the past two years, it has also presented an opportunity for investors willing to take a calculated risk on the sector.

Indeed, earlier this month, special-situations-focused GP Alchemy Partners invested in the launch of M2 Subsea, an Aberdeen-based provider of remotely operated vehicles to the oil and gas sector. Other deals in 2016 include Dunedin-backed EV Offshore's bolt-on of software company Epidote and Norvestor's acquisition of Norwegian oil well integrity company HydraWell Intervention.

Company
Headquartered in London and founded in 2004, OMV UK is an offshore energy business whose assets are concentrated in the region west of Shetlands. It controls 11.8% of the Schiehallion oil field, 20.0% of the Rosebank field and 5.6% of the Jade field.

The wider OMV group generates revenues of €23bn and employs 24,100 people. The group stated its UK arm accounts for €350m of EBIT at current exchange rates, around $380m.

People
Blackstone – Mustafa Siddiqui (managing director).
Siccar Point Energy – Jonathan Roger (CEO).
OMV – Rainer Seele (CEO).

Advisers
Equity – Rothschild (financial due diligence); Ashurst (legal).