“Energean” sells its assets in Egypt, Italy and Croatia for $945 million
Carlyle (CG.O), opens new tab will form a new Mediterranean-focused oil and gas company led by former BP (BP.L), opens new tab CEO Tony Hayward after the private equity fund agreed to acquire Energean’s (ENOG.L)
Energean plc entered into a binding agreement to sell its portfolio in Egypt, Italy, and Croatia to Carlyle International Energy Partners for an enterprise value (EV) of up to US $945 million, with $820 million firm. The transaction is expected to complete by the end of 2024, subject to customary regulatory and antitrust approvals.
The sale represents a significant milestone for Energean, generating more than a 3x return on the portfolio, which was acquired for $284 million in 2020. The enterprise value/2P multiple stands at $5.4/boe, a substantial increase from approximately $1.2/boe at the time of acquisition. This transaction is expected to be immediately accretive to free cash flow, providing sufficient cash proceeds to repay in full the $450 million PLC Corporate Bond and facilitate a special dividend of up to $200 million.
But it will seek to grow output by upgrading existing assets and through other acquisitions in the Mediterranean, CIEP co-head Bob Maguire told Reuters.
“There is plenty of running room for these assets in terms of geology,” Maguire said, adding that growing demand for natural gas in Egypt and Italy will underpin future investments.
Energean, whose main production comes from a gas facility offshore Israel, will also look to expand to the wider Europe, Middle East and Africa region, particularly where there is long-term policy support for gas and displacement of coal, CEO Mathios Rigas told Reuters.
“It’s a great deal for us, we’re selling assets at three times the price we bought them,” he said.
Shares of Energean were up 2.7% .
Strategic rationale
The strategic rationale behind the sale includes optimising Energean’s portfolio by divesting later-life assets, removing over 60% of the Group’s decommissioning liabilities, and improving free cash flow generation in the short to medium term.
The sale aligns with Energean’s focus on its gas-weighted strategy, particularly its operations in the Karish Field in Israel and the recent farm-in to the Anchois field in Morocco. This strategy aims to maximise asset monetisation, free cash flow generation, and returns to shareholders.
“This transaction unlocks management capacity and financial flexibility to drive future growth,” added Rigas. “Our focus will now be to create enhanced value from our Israel assets and evaluate new opportunities that fit Energean’s key business drivers: paying a reliable dividend, deleveraging, growth, and our commitment to Net Zero. Carlyle is the right custodian of the asset base and will create an excellent home for our colleagues. We wish them every success and look forward to watching their progress.”
It is notewirthy ,The deal will allow Carlyle to tap into the eastern Mediterranean gas market that has grown rapidly in recent years as gas demand in Egypt soars and Europe seeks alternatives to Russian gas.
“This acquisition provides a strong platform to build a standalone regional champion in the Mediterranean, one of the fastest growing natural gas markets in the world,” Hayward, chairman designate of the new company, said in a statement.
Apex Group issues new Holdco PIK Notes with an incremental $1.1bn from Carlyle and Goldman Sachs
On the other hand , Apex Group Ltd. (“Apex”) has announced global investment firm Carlyle’s Global Credit business (“Carlyle”) and Goldman Sachs Private Credit (“Goldman Sachs”), have jointly committed in excess of $1.1bn into the global financial services provider. This commitment endorses Apex’s sustainable growth strategy, following the successful integration of a number of previous acquisitions, continued strong organic growth and technological innovations.
Apex’s assets on platform now stand at ~$3.1tn serviced across custody, administration, depositary and under management by over 13,000 employees worldwide.
Carlyle and Goldman Sachs have committed to Holdco PIK Notes of Apex to continue to support the company’s growth plans that will focus on optimising the current platform, strategy and combined investment in technology innovation.
This builds on the firms’ continued relationship with Apex, following an initial Preferred Equity Note in 2020 and a follow-on issuance in 2021. Upon completion of the transaction Apex will have enhanced its financial profile, both in terms of leverage and liquidity.
