,

Colombia’s Pacific Rubiales buys rival oil firm Petrominerales

(Reuters) – Pacific Rubiales Energy Corp, Colombia’s largest private oil company, said it will buy compatriot oil producer and explorer Petrominerales Ltd  for COP$1.6 billion Colombia Pesos (US$1.55 billion), financing the deal with cash and loans.

Petrominerales shareholders will receive COP$11 in cash per ordinary share, totaling around COP$935 million, plus a common share in the recently formed ExploreCo, and the assumption of net debt estimated at COP$640 million, including convertible bonds. It has operations in Colombia, Peru and Brazil.

“The financing of the acquisition will take place through available cash and bank credit lines, including an acquired commitment of a US$1.3 million short term bank loan that the company hopes to refinance once the acquisition is complete,” Pacific Rubiales said in a filing to Colombia’s financial regulator late on Sunday.

Pacific Rubiales will acquire 18 blocks comprising 1.6 million acres gross and net in Colombia, and four blocks comprising 8.2 million acres gross, or 5.2 million net, in Peru.

Through the purchase, Pacific Rubiales will also gain 5 percent of oil pipeline Oleoducto Central S.A. and 9.65 percent of pipeline Oleoducto Bicentenario, both of which are in Colombia.

“This acquisition fits our strategy excellently, generating immediate additional value through synergies of assets and increasing production and cash flow attractively,” Pacific Rubiales Chief Executive Ronald Pantin said in the filing.

Canada’s financial regulator suspended trading in the shares of both Toronto-listed companies on Friday amid speculation of a forthcoming deal.

Since you’re here …

… we have a small favour to ask. More people are reading the Today Colombia than ever but advertising revenues across the media are falling fast. And unlike many news organizations, we haven’t put up a paywall – we want to keep our site as open as we can. So you can see why we need to ask for your help. Updating reports on Today Colombia takes a lot of time, money and hard work. But we do it because we believe our reports matter.
If everyone who reads Today Colombia, who likes it, helps to support it by clicking our ads, our future would be much more secure. Do you part, click on an ad today.

Written by Rico

Rico

"Rico" is the crazy mind behind the Q media websites, a series of onlinemagazines that includes TodayColombia.com. Rico brings his special kind of savvy to online marketing. His websites are engaging, provocative, informative and sometimes off the wall, where you either like or you leave it. The same goes for him, like him or leave him.There is no middle ground. No compromises, only a passion to present reality as he sees it!