BP PLC BP confirms commitment to completing Alaska sale (9304K)
27 Abril 2020 - 1:39AM
UK Regulatory
TIDMBP.
RNS Number : 9304K
BP PLC
27 April 2020
press release
27 April 2020
BP confirms commitment to completing
sale of its Alaska business
-- Continues to expect completion in mid-2020
-- Total consideration remains $5.6 billion
-- Financial terms adjusted to reflect market conditions
London: BP today confirmed its commitment to completing the sale
of its Alaska business to Hilcorp, first announced in August 2019.
Subject to regulatory approvals, the parties expect to complete the
transaction in June 2020.
Reflecting recent significant market volatility and oil price
falls, BP and Hilcorp have successfully renegotiated the financial
terms of the deal to respond to the current environment.
William Lin, BP chief operating officer, Upstream regions said:
"We have worked closely with Hilcorp to reconfirm our commitment to
completing this deal. The agreed revisions respond to market
conditions while retaining the overall consideration. We look
forward to progressing swiftly to completion and for Hilcorp to
take over the operation of this important business. We are
confident that completion of this sale is the right thing for both
parties, for the business and for Alaska."
Under the revised agreement, the total consideration for the
sale remains unchanged at $5.6 billion, subject to customary
closing adjustments. However, the structure of the consideration
and phasing of payments has been modified.
The original agreement provided for Hilcorp to pay BP $4.0
billion near-term and $1.6 billion through an earnout thereafter.
Hilcorp paid BP a $500 million deposit on signing of the
transaction in 2019.
The revised agreement adjusts the structure and phasing of the
remaining consideration to include lower completion payments in
2020, new cash flow sharing arrangements over the near-term,
interest-bearing vendor financing and, potentially, an increase in
the proportion of the consideration subject to earnout
arrangements.
The revised agreement is expected to maintain the majority of
the value of the transaction. It is also structured with
flexibility to phase and manage payments to accommodate current and
potential future volatility in oil prices.
BP and Hilcorp have developed detailed transition plans to
deliver a smooth handover of operations upon completion to allow
Hilcorp to focus on embedding planned operating efficiencies as
rapidly as possible.
This transaction is part of BP's divestment programme to deliver
$15 billion of announced divestments by mid-2021. Further
information relating to this transaction will be included in BP's
first quarter 2020 results scheduled for release on 28 April
2020.
Further information :
BP press office, London: bppress@bp.com , +44 (0)7831 095541
Cautionary statement :
In order to utilize the 'safe harbor' provisions of the United
States Private Securities Litigation Reform Act of 1995 (the
'PSLRA'), BP is providing the following cautionary statement. This
press release contains certain forward-looking statements - that
is, statements related to future, not past events and circumstances
- which may relate to one or more of the financial conditions,
results of operations and businesses of BP and certain of the plans
and objectives of BP with respect to these items. These statements
are generally, but not always, identified by the use of words such
as 'will', 'expects', 'is expected to', 'aims', 'should', 'may',
'objective', 'is likely to', 'intends', 'believes', 'anticipates',
'plans', 'we see' or similar expressions. In particular, among
other statements, statements relating to BP's divestment programme
and plans including expectations with respect to completion of
transactions and the timing of receipt of proceeds of divestments
and other disposals. By their nature, forward-looking statements
involve risk and uncertainty because they relate to events and
depend on circumstances that will or may occur in the future and
are outside the control of BP. Actual results may differ from those
expressed in such statements, depending on a variety of factors
including the extent and duration of the impact of the current
market conditions including the significant drop in the oil price,
overall global economic and business conditions impacting our
business and demand for our products, as well as the risk factors
set forth in our most recent Annual Report and Form 20-F under
"Risk factors" and in any of our more recent public reports.
Our most recent Annual Report and Form 20-F and other period
filings are available on our website at www.bp.com or can be
obtained from the SEC by calling 1-800-SEC-0330 or on its website
at www.sec.gov
This information is provided by RNS, the news service of the
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END
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