BHP Billiton one step closer to Petrohawk Energy acquisition

Tuesday, 23 August 2011

Australia-based global mining giant BHP Billiton announced Monday that it has completed its tender offer to acquire the shares of US-based shale gas mining company Petrohawk Energy Corporation. BHP will pay US$38.75 per Petrohawk share in its takeover deal. Petrohawk shares represent a total equity value of approximately US$12.1 billion and a total enterprise value of approximately US$15.1 billion. The acquisition gives BHP positions in two of the US' largest shale drilling formations, the Eagle Ford and Haynesville plays.

In a press release, BHP said that by midnight Friday, August 19, BHP successfully acquired 97.4 percent of the outstanding shares of Petrohawk. "As the final step of the acquisition process and following payment for all shares validly tendered and not withdrawn on or prior to the expiration of the Offer, BHP Billiton expects to effect a short-form merger under Delaware law as promptly as practicable."

(sourced steelorbis)

BHP Billiton in big US shale gas deal

By Rachel Hewitt,
Feb23, 2011 12:00AM

MINING powerhouse BHP Billiton has snapped its streak of failed deals with a $US4.7 billion foray into United States shale gas.

In a move analysts said would cool speculation BHP has a bigger oil play in the pipeline, the miner yesterday revealed it had bought into an Arkansas shale gas field, allowing it access to "the fastest growing market in the world".

As BHP unveiled the deal, it also pleased investors by announcing that a $5 billion off-market buyback of its Australian shares would begin immediately.

The news sent BHP shares almost 1.6 per cent, or 73, higher to $46.58 -- making it a standout in a downbeat market.

BHP's buy of all Chesapeake Energy Corporation's interests in the Fayetteville shale field is its first key deal since its failed $40 billion tilt for Canada's PotashCorp in November.

Citi analysts yesterday said the shale gas play would "partially cool the heated speculation of a larger on-market M&A (mergers and acquisitions) oil deal being in the pipeline".

Deutsche Bank analyst Paul Young said the Fayetteville buy fitted BHP's checklist of "low-cost, long life and expandable" assets.

"We did think, and we continue to think, that they're also looking at acquisitions in deep water oil such as the Gulf of Mexico," he said.

Energy rival Woodside Petroleum has long been named as a potential BHP takeover target, but Pengana Capital fund manager Tim Schroeders said yesterday that appeared increasingly unlikely.

Platypus Asset Management's Prasad Patkar described BHP's shale gas foray as "a bet on the long-term price in the US domestic gas market".

Through the deal, BHP will own and operate the second biggest position in the Fayetteville field.

BHP Petroleum chief Michael Yeager said it would increase the company's reserve and resources base by 45 per cent and BHP would acquire more than 10 trillion cubic feet of gas.

He said BHP hoped to triple the asset's daily volumes over the life of the development.
(sourced:Herald Sun)