Ocean Energy Divests Canadian Assets
Aggressively attempting to lower debt before its upcoming merger
with Seagull Energy, Ocean Energy Inc. sold its Canadian oil and
gas division Friday to Quintana Minerals Canada Corp. for $74
million. OEI said shareholders for both companies are holding
special meetings March 30 to vote on the merger. If they vote in
favor, the company will be officially merged that afternoon.
The company sold its entire Canadian presence Friday when
Quintana bought OEI's Canadian subsidiary. "This was a stock deal,
and Quintana bought the entire company," said Mike Aldridge, Ocean
Energy's vice president of corporate communications. "We have no
other Canadian assets."
Earlier last week, Ocean Energy sold $42 million of Permian Basin,
Gulf Coast and Gulf of Mexico assets (See
Daily GPI, March 24). Combined, the two sales amount to $116
million and 164 Bcf of gas.
"When we announced the proposed merger with Seagull, we said
that we would manage debt and raise capital through the disposition
of assets, with a target of $200 million in asset sales for the
combined company in 1999,'' said James C. Flores, Ocean Energy
president. "The $116 million of divestitures Ocean has announced,
coupled with $38 million Seagull announced recently, represents a
significant step toward achieving that objective and demonstrates
our commitment to debt reduction and the speed with which we are
implementing our business strategy."
Ocean Energy expects the sale to close by the end of April with
the remainder closing before May. Nesbitt Burns, Inc. acted as
financial advisor to Ocean Energy for the Canadian transaction.
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