Ocean Energy to buy Texoil for more than $100 mln
HOUSTON, Jan 18 (Reuters) - Independent energy company Ocean Energy Inc <OEI.N> plans to buy independent oil and gas company Texoil Inc <TXLI.O> in a cash deal worth more than $100 million, the companies said on Thursday.
Ocean Energy plans to buy all outstanding Texoil common shares for $8.25 per share and all outstanding shares of Texoil's Series A convertible preferred stock for $18.04 per share, the Houston-based companies said in a joint statement.
According to a Texoil spokesman, the company has about 6.725 million common shares and 2.992 million Series A preferred shares outstanding, which values the deal at just under $109.5 million. The deal also includes assumed bank debt of about $15 million plus certain other liabilities, the companies said.
The acquisition is expected to be accretive to Ocean's earnings and cash flow.
Several principal Texoil stockholders, who collectively own greater than a majority of Texoil's common stock and preferred stock, have agreed to tender their shares and vote such shares in favour of the deal.
Ocean estimates total proved reserves of about 150 billion cubic feet of natural gas equivalent, of which some 57 percent are gas reserves. During 2000, Texoil's average production rate was about 34 million cubic feet of gas equivalent per day.
Ocean will succeed Texoil as operator of about 80 percent of the properties, Ocean's executive vice president of operations, John Schiller, said in the statement.
On Thursday, shares of Ocean Energy closed off 7/16 at $15-5/16 and Texoil shares ended the session down 1/16 at $7-1/2.
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