Norsk Hydro and Statoil Seal Deal Over Saga Petroleum Acquisition

Norsk Hydro and Statoil, two of Norway's leading oil companies, have reached a compromise deal that paves the way for Norsk Hydro's takeover of Saga Petroleum, the country's third-largest oil producer. The agreement, which ends a protracted negotiation between the two companies, has been met with skepticism by Saga Petroleum's management, who remain keen on finding a foreign suitor. The deal marks another step in the consolidation of the Norwegian oil and gas sector, with Norwegian industrial interests determined to keep Saga in domestic hands.

Key Takeaways:

• Norsk Hydro and Statoil have sealed a deal that gives Statoil 25% of Saga Petroleum's assets in exchange for cash and Statoil's shares in Saga.
• The deal paves the way for Norsk Hydro's takeover of Saga Petroleum, which was unveiled earlier this month.
• Norsk Hydro will change its original one-for-three share offer to require 70% shareholder approval instead of 90%.
• The deal has been met with skepticism by Saga Petroleum's management, who want to find a foreign suitor.
• Norsk Hydro has agreed to give Statoil NKr7bn ($891m) worth of interests in certain Norwegian and Irish oil and gas offshore licences.
• The compromise solution ends a protracted negotiation between Norsk Hydro and Statoil over which company would acquire Saga Petroleum.

Statistics:

• 25%: The percentage of Saga Petroleum's assets that Statoil will receive in the deal.
• NKr7bn: The value of interests in Norwegian and Irish oil and gas offshore licences that Norsk Hydro will transfer to Statoil.
• $891m: The equivalent value of NKr7bn in US dollars.
• 70%: The percentage of shareholder approval required for Norsk Hydro's takeover of Saga Petroleum.
• NKr5: The amount by which Saga Petroleum's shares closed yesterday.

Sources:

• Financial Times Limited 1999. All Rights Reserved.