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Stocks T / Triton Energy Limited
|Subject: So Long, And Thanks For All The Fish||Date: 7/10/2001 10:32 AM|
|Author: NechesInvst||Number: 108 of 116|
Tuesday July 10 10:09 AM ET
Amerada Hess to Buy Triton Energy
NEW YORK (Reuters) - Energy company Amerada Hess Corp. (NYSE:AHC - news) on Tuesday said it would buy Triton Energy Ltd. (NYSE:OIL - news) for $2.7 billion in cash, advancing its shift toward the more profitable exploration and production side of the business.
Under terms of the agreement, Amerada Hess will pay $45 cash for each share of Triton, a premium of 50 percent to Triton's stock closing price on Monday. Amerada Hess will also take on $500 million of Triton debt.
To pay for the deal, New York-based Amerada Hess anticipates having $300 million in cash on hand and will borrow the remainder from a $3 billion unused facility.
Amerada Hess said it has received an ``irrevocable commitment' from investment firm Hicks, Muse, Tate & Furst Inc. to sell its 38 percent stake in Dallas-based Triton to Amerada Hess.
The deal is expected to close in the third quarter.
``The acquisition of Triton strengthens our exploration and production business, gives us access to long-life international reserves, substantially increases our production growth and provides significant exploration potential,' John Hess, chairman and chief executive of Amerada Hess, said in a statement.
He added the acquisition would increase Amerada Hess's production to about 535,000 barrels per day in 2002 and more than 600,000 barrels per day in 2003, from a present 425,000 barrels of oil equivalent per day.
Also, the deal would add to Amerada Hess's earnings and cash flow per share in 2002, the company said.
Consolidation in the oil exploration and production sector has come fast and furiously of late. Earlier this year, Conoco Inc. (NYSE:COCB - news), the No. 4 U.S. oil company, agreed to buy Gulf Canada Resources Ltd. (GOU.TO) for about $4.3 billion in cash, while its nearest competitor Phillips Petroleum Co.