Anadarko Petroleum shares jumped more than 5% Wednesday to $44.93 on a report by Reuters that the company has hired Credit Suisse First Boston to negotiate with potential buyers. Anadarko would not confirm the details of the report.

The Reuters report, which quoted unnamed sources, said Anadarko is sharing key financial information with potential bidders and expects to sell the company in a two-part auction process, with exclusive negotiations beginning in October.

Last week, Anadarko launched a restructuring program designed to save $100 million annually. But speculation that it might sell to the highest bidder started in mid-March when former CEO John Seitz abruptly resigned over what appeared to be poor stock performance (see Daily GPI, March 27).

Southwest Securities analyst John Gerdes named ConocoPhillips and ChevronTexaco as potential bidders and noted that in the past, Royal Dutch Shell, Italy’s Eni and BP have had their eyes on the company and “are likely to go through the company’s numbers.”

“The indication of hiring a financial advisor and likely assignment of fair acquisition premium should act as a positive catalyst for major independent producer shares with significant North American natural gas exposure,” Gerdes said in a research note on Wednesday.

“Our valuation of Anadarko assigns a fair value of $57/share based on a 15% return to equity capital and long term $27/bbl oil and $4.75/MMBtu gas prices,” he said. “In the current market environment, a takeout premium of 15-25% would reflect an acquisition price of $49-53/share. This translates to 4.4-4.7x forward cash flow.”

Increasing North American natural gas exposure is a priority among many of the majors, according to analysts. Anadarko’s natural gas holdings in Algeria also should draw interest.

©Copyright 2003 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.