French oil company Maurel & Prom (M&P) has agreed to acquire Gabon-focused onshore oil upstream and midstream company Assala Energy from private equity fund Carlyle Group for $730m (€671.6m).
Under the agreement, M&P will acquire 100% of the shares in Assala Energy and all of its subsidiary entities that own its entire upstream and midstream assets in Gabon.
M&P said the assets considered for acquisition are strategically located adjacent to its existing assets in Gabon.
M&P expects the acquisition to create a leading onshore operator in Gabon while providing access to the strategic Gamba oil export terminal and a pipeline of organic development opportunities.
For the first half of 2023, Assala reported production of 40,700 barrels of oil per day (bopd) on a consolidated working interest basis.
In a press statement M&P said: “The Transaction will enable M&P to reach critical scale with proforma consolidated working interest production for the group of 67.8 thousand bopd (including 64.4 thousand barrels of oil equivalent per day of operated production) in the first half of 2023, of which 56.5 thousand bopd were in Gabon.
“M&P and Assala operate nearly all of their oil production, which provides meaningful leverage to optimise operations and costs across the combined portfolio.”
Subject to approvals, including from the Republic of Gabon and Communauté Economique et Monétaire de l’Afrique Centrale merger control clearance, the transaction is planned to close between Q4 2023 and Q1 2024.
M&P CEO Olivier de Langavant said: “The acquisition of Assala represents a step change for M&P. The combination of our portfolios provides the Group with a large operated base of long-life, low-cost onshore assets offering long-term visibility and substantial development potential in a stable country where M&P has been operating for over fifteen years.”
Morgan Stanley, Hannam & Partners and Mandiri Sekuritas served as financial advisors while Herbert Smith Freehills Paris acted as legal advisor on the transaction to M&P.
Furthermore, the Gabonese Government has agreed to increase its stake in Assala’s subsidiary Assala Gabon to 27.5% from 25%. This is based on similar economic terms as M&P’s acquisition.
The government also holds an option to increase its stake in Assala Gabon by an additional 12.5% over the next five years, on similar terms.