*AV*--OIL's well but it doesn't end well.
Friday July 17, 8:48 am Eastern Time
Triton won't sell company, sets deal with ARCO
DALLAS, July 17 (Reuters) - Ending weeks of speculation, Triton Energy Ltd. (OIL - news) said on Friday the company will not be sold after reviewing potential buyers for its assets in Asia and Latin America, and it also announced that its top executive resigned.
In a move that will likely shock investors who were betting on a sale, the oil and gas company instead said it signed an agreement with Atlantic Richfield Co. (ARCO) (ARC - news) to develop Triton's gas reserves in the Malaysia-Thailand Joint Development Area. Triton said it was the best option to emerge from its review of strategic alternatives.
Robert Holland, Triton's interim chief executive, conceded that investors would not be happy with the announcement by the company. Triton, whose stock has been on a rollercoaster ride in recent
days, shot to fame in 1983 when it started to develop the Cusiana and Cupiagua fields in Colombia -- among the largest oil finds in the Western Hemisphere.
''We believe that the benefits of this transaction to the company are substantial...We understand, however, that some shareholders may be disappointed that the process did not result in the sale of the company,'' said Holland. He replaced Thomas Finck, who announced his resignation as chairman, president and chief executive.
Under the ARCO deal, the Los Angeles-based oil giant would buy half of the subsidiary that holds
Triton's 50 percent interest in Block A-18, in the Asian venture.
ARCO would pay $150 million when the deal closed, finance up to $377 million of Triton's share of the block's costs, and pay two additional amounts ranging from $40 million to $65 million if certain objectives were met in coming years. Triton said it would recover its investment in the project to date, which is in excess of $100 million.
Triton also said it would record an after-tax gain of about $63 million in the third quarter on closing of the deal.
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