Wintershall and DEA Unite

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BASF and LetterOne have signed a definitive transaction agreement to merge their respective oil and gas businesses Wintershall and DEA in a joint venture, which will operate under the name Wintershall DEA.

With Wintershall DEA we create the leading independent European exploration and production company with international operations in core regions. By combining the two German-based entities, BASF and LetterOne lay the basis for further profitable growth,” said Dr. Hans-Ulrich Engel, vice chairman of the board of executive directors and chief financial officer of BASF SE.

In the medium term, BASF and LetterOne envisage to list Wintershall DEA through an Initial Public Offering (IPO).

Closing of the transaction is expected in the first half of 2019, subject to approvals of merger control and foreign investment authorities as well as mining authorities and the German Federal Network Agency. Until closing, Wintershall and DEA will continue to operate as independent companies.

In 2017, the combined business of Wintershall and DEA had pro-forma sales of €4.7 billion, income from operations before depreciation and amortization (EBITDA) of €2.8 billion and net income of €740 million. In 2017, pro-forma hydrocarbon production of Wintershall and DEA totaled 210 million barrels of oil equivalent (BOE); this equals a production of around 575,000 BOE per day.

The joint venture will have a regionally more balanced footprint with growth opportunities in the core regions and strives for a daily production of 750,000 to 800,000 BOE between 2021 and 2023. Through the merger, synergies of at least €200 million per year are expected as of the third year following the closing of the transaction.

Mario Mehren, chief executive officer of Wintershall, has been appointed as the chairman of the management board and CEO of Wintershall DEA. Maria Moraeus Hanssen, CEO of DEA, has been determined as the deputy CEO and chief operating officer of the joint venture.

In addition, Thilo Wieland, member of the board of executive directors of Wintershall, and Hugo Dijkgraaf, managing director of Wintershall Norge, will be on the five-member management board of Wintershall DEA. The appointment of the chief financial officer will take place at a later date.

To effect the merger, LetterOne will contribute all its shares in DEA Deutsche Erdöl AG into Wintershall Holding GmbH against the issuance of new shares of the company to LetterOne. Wintershall will then be renamed Wintershall DEA, which will be headquartered in Kassel and Hamburg.

BASF will initially hold 67% and LetterOne 33% of Wintershall DEA’s ordinary shares reflecting the value of the respective exploration and production businesses of Wintershall and DEA. To reflect the value of Wintershall’s gas transportation business, BASF will receive additional preference shares.

No later than 36 months after closing but in all cases before an IPO, these preference shares will be converted into ordinary shares of the company Wintershall DEA. This will result in a total shareholding of BASF in Wintershall DEA of 72.7%.

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6th Offshore Well Intervention Conference Gulf of Mexico

The Offshore Well Intervention Gulf of Mexico conference (OWI GOM) is returning to Houston, Texas for its sixth year on Wednesday 20 – Thursday 21 November.

Featuring Anadarko, BP, Shell, Chevron, BHGE and Oceaneering, the conference aims to help operators transition to the latest compliance updates, WI systems and business models that enhance safety, quicken well access and improve commerciality.

Across two days, more than 200 delegates, 15 exhibitors and 30 speakers will network together and create solutions to some of the most pertinent industry challenges right now, through a conference programme focused on:

  1. Clarifying compliance updates
  2. Quicker well access and safer well control
  3. ​Understanding HPHT well intervention (systems)
  4. Forecasting well intervention activity, discussing new commercial models and comparing platform options
  5. Best practice riserless well intervention
  6. ​The latest well intervention equipment

For registration, speaking or sponsorship enquiries contact Abigail Clifton on aclifton@offsnet.com; +44 (0) 203 793 8800.

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