The oil and gas company reportedly trying to buy rival Apache Corporation, has been revealed as Texas based Anadarko Petroleum.
Apache’s investors were hoping that the secret bidder was a super major, with rumours circling the industry that giant ExxonMobile was behind the acquisition. If true investors would have likely seen a large payout on their investment, most likely in the shape of shares in the ExxonMobile business.
However, comments from investors today, haven’t been so welcoming of the news that the buyer looks to be Anadarko- a rival oil and gas company not much bigger than Apache itself.
Anadarko is currently heavily straddled with debts of 2.8 times Ebitda, meaning that they are unlikely to be in the situation to offer a cash deal for Apache, and any alternative offers of shares in a heavily indebted firm would have not been welcomed.
Apache Oil Reserves
The main reason sited by analysts behind Anadarko’s bid to try and acquire Apache, is Apache’s oil and gas reserves in place.
Apache has much larger oil and gas stocks, located within its licence blocks than that of Anadarko. Anadarko itself has been struggling to increase its stocks over recent years and has suffering multiple failed licence blocks and empty wells, even thought it hugely increased spending on exploration.
Currently opinions are split on whether Anadarko will attempt another acquisition of Apache Corp with a higher offer, or with their own current financial situation, whether they even have the means to do it.
On todays news that it was Anadarko behind the deal, the firm’s shares fell sharply, pointing that the company’s own investors don’t think much of it either.
At the other end, Apache Corporation’s share rose slightly, indicating that their investor are unlikely to agree to any further action on the matter.