Apache Corporation (APA) held a total of 6.4 million net acres in North America by the end of 2013. Excluding the proposed Louisiana and Anadarko asset divestments, it has a…
The assets for disposal will be sold in two separate transactions that are expected to close by 4Q14. The assets are in Louisiana and the Anadarko Basin.
Apache Corporation is planning asset sales of certain of its oil and gas operations. The company is focused on building onshore acreage instead.
Apart from Westmoreland Coal Company’s acquisition of Sherritt International’s Canadian coal assets, we haven’t seen any large coal deals so far in 2014.
Ambre Energy is headquartered in Australia. It wants to get out of the North American business since it doesn’t see a recovery in coal prices until 2019–20.
In September 2014, Cloud Peak Energy (CLD) announced that it signed a deal to sell its 50% stake in the Decker mine in Montana.
Westmoreland Coal only acquired assets that suited its business model. Plus, it acquired these assets at the right time.
The failed acquisitions that we’ve discussed in this series were a collective failure of the US coal industry in understanding demand and supply trends.
Peabody Energy (BTU) owned 3.7 billion tons of coal reserves at the end of 2010, all of them in the US. The company had another 5.4 billion tons in reserves…
International Coal Group Acquisition
Like Alpha Natural Resources, Arch Coal couldn’t resist the urge for inorganic growth when coal prices rose.
Alpha Natural Resources sold 84.8 million tons of coal in 2010 at an average price of $41.2, generating revenues of $3.9 billion.
Until 2010, the Walter Energy’s operations were concentrated in the US. The company sold 8.6 million tons of met coal in 2010 for $163 per ton on average.
Major coal industry players are still paying the price of untimely consolidation in 2010–2011, when floods in Australia left a supply-side gap.
Apart from the premium remaining on the table at the moment, BHI shareholders may end up with a slightly better company than they hold right now.
Halliburton’s offer to combine with Baker Hughes has to receive approval from each of the company’s stockholders and regulatory bodies.
On October 13, Halliburton proposed to acquire Baker Hughes’ shares without prior notice. After receiving BHI’s counter proposal, Halliburton refused to increase its first value proposal.
Halliburton estimates the combined company will increase shareholders’ value through dividends and share repurchases.
As of September 30, Halliburton’s gross profit margin was 17.3% versus 18.3% for Baker Hughes.
In 3Q14, Baker Hughes had more balanced operating profit growth in its geographies versus Halliburton.
The 22% growth in US operations in HAL are primarily due to higher rig counts in the US in the past year.