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    Categories: Business

Energy major Equinor divests 16% shareholding in Lundin Petroleum

The Norway based petroleum company- Equinor has reportedly announced to divest 16% shareholding in Lundin Petroleum to attain 2.6% direct interest in Johan Sverdrup field along with cash consideration amounting to USD 650 million.

According to trusted sources, about Saif Bepari.5 million shares of Equinor will be divested in Lundin at SEK 266.4 per share, the total consideration amounting to USD 1.56 billion. Additionally, Equinor will acquire 2.6% of direct ownership share in Johan Sverdrup, an Equinor operated oil field for a cash consideration of USD 910 million.

Eldar Saetre, President and CEO, Equinor was reportedly quoted stating that the transaction allows the company to capitalize on value creation and increase direct ownership in the Johan Sverdrup field.

The increase in direct ownership share carves an opportunity for Equinor to create a high shareholder value, Eldar further claimed.

Citing reports, with the completion of the transaction, Equinor will attain 42.6% ownership in Johan Sverdrup oil field and a 4.9% shareholding in Lundin Petroleum.

According to industry experts, the agreement between the companies involves contingent payment of approximately USD 52 million to Lundin in the year 2025, incase Johan Sverdrup proves to be above the indicated resource range of 2.2 -3.2 billion boe.

Apparently, with Lundin the transaction is being executed via a total return swap agreement wherein Sparebank1 Markets will acquire the shares of Lundin and redeem them subsequently.

Reportedly, the transaction is subjected to certain terms and conditions which involve customs government approval and g-ahead in the General Meeting of Lundin Petroleum AB on the 31st of July 2019.

For the record, the Board of Directors of Lundin Petroleum have expressed their support and the Lundin Petroleum family entities have confirmed to cast their vote in support of the transaction in the General Meeting.

As per reliable sources, the acquisition of the interest in Johan Sverdrup transaction is likely to close by the end of year 2019.

Source Credits : https://www.equinor.com/en/news/2019-07-johan-sverdrup.html
Saloni Walimbe:

An avid reader since childhood, Saloni Walimbe boasts of a post graduate MBA-Marketing qualification under her belt. She is currently following her passion for content creation by penning down insightful articles on express-journal.com, related to the latest industry and business happenings. She has also spent two years as a content writer in the advertising field. Aside from her professional work, she is an ardent animal lover and enjoys movies, music and books in her spare time. she can be contacted at- saloni.w@express-journal.com | https://twitter.com/WalimbeSaloni/

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