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EDITOR IN CHIEF- ABDULLAH BIN SALIM AL SHUEILI

BASF agrees oil merger with Russian tycoon’s firm

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Frankfurt am Main: German chemicals giant BASF has agreed to merge its Wintershall oil and gas unit with the DEA energy firm owned by Russia’s billionaire entrepreneur Mikhail Fridman.


The multi-billion-euro deal will create “one of the largest independent European exploration and production companies” with “significant growth potential” and scope for synergies, BASF said in a statement late on Thursday.


BASF said it would initially hold 67 per cent of shares in the joint venture, which will go by the name Wintershall DEA.


The remaining shares will be held by the LetterOne group, Fridman’s Luxembourg-based investment group which owns DEA.


There are plans for the new entity to be listed on the stock exchange “in the medium-term”, BASF added. BASF and LetterOne signed a letter of intent to merge on Thursday and expect the deal to close in the second half of 2018, depending on regulatory approvals.


LetterOne purchased DEA, which specialises in oil and gas exploration and production, from German energy group RWE in 2015 for 5.1 billion euros ($6.0 billion). — AFP


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