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DEA taking over Sierra Oil and Gas
Posted on Wednesday, 05 December 2018 10:45
DEA Deutsche Erdoel has signed on the dotted line to acquire Mexico-based energy company Sierra Oil and Gas.

No financial details of the acquisition, which is subject to the green light from regulatory bodies including Mexico’s National Hydrocarbons Commission and expected to complete during the first half of 2019, have been disclosed at this time.

Commenting on the agreement, Maria Moraeus, chief executive of DEA Deutsche Erdoel, said: “The acquisition of Sierra will allow DEA to achieve materiality in the highly strategic and competitive Mexican upstream market and provide us with a high-quality exploration and appraisal portfolio in one of the world’s most sought-after offshore basins, as well as a strong team.

“The transaction also underlines our confidence in the future of Mexico’s energy industry.”

She concluded by saying that the deal will also strengthen the target country’s status as a core market for the business.

DEA shareholder LetterOne will finance the acquisition.

Sierra Oil and Gas claims to be at the forefront of Mexico’s independent oil and gas wave, as well as the country’s first independent oil and gas company.

DEA’s acquisition of the company will represent an exit for Riverstone Holdings and EnCap Investments, who invested in the business as part of a USD 1.05 billion funding round in September 2014.

The buyer has itself been the subject of a takeover approach this year, as BASF submitted a EUR 12.00 billion bid and signed a definitive agreement.

That deal is slated to close in the first half of next year, subject to the green light from foreign investment authorities, mining authorities and the Bundesnetzagentur.

Zephyr, the M&A database published by Bureau van Dijk, shows the most valuable deal targeting an oil and gas extraction company to have been announced worldwide in 2018 is Energy Transfer Equity’s USD 27.00 billion purchase of Energy Transfer Partners.

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