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Maurel & Prom Completes Caroil Purchase; Divests Tuscany Stake 2013-12-24 13:53:45.479 GMT

By Benjamin Dow Dec. 24 (Bloomberg) -- Maurel & Prom sold 109m Tuscany International Drilling shares, entire stake in co., to “entity incorporated in the Cayman Islands.” * MAU FP assumes $50m of TID CN debt in accordance with Credit Suisse credit agreement * Maurel expects to buy 2 drilling rigs from Tuscany for $23m, $15m of sum already paid * MAU FP pares gains to +0.8% today; up as much as 1.2% earlier in sixth day of gains; volume 284k shares is 1.2x daily average over past 3 months * TID CN down 69% YTD

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To contact the editor responsible for this story: Benjamin Dow at +7-495-771-7735 or bdow2@bloomberg.net

Batista to relinquish OGX control in debt deal

Former Brazilian billionaire Eike Batista is to relinquish control of his flagship oil company as part of a deal with creditors to exchange about $5.8bn in debt for shares. Under the deal, which comes less than two months since the company filed for bankruptcy and will complete its disintegration, bondholders may also inject about $200m-$215m into the restructured entity. "The existing shareholders of the company, after the dilution stemming from the creditors’ debt-for shares swap . . . will be left with equity representing 10 per cent of the capital of the restructured company," said the group, formerly known as OGX, renamed Óleo e Gas Participações under the new arrangements. The deal was unexpected, and come just two months after the then-OGX filed for bankruptcy protection, blaming differences with creditors during the restructuring talks. The implosion of the oil, energy, mining and logistics magnate’s empire saw him tumble from the top ten of the Forbes rich list to eviction from its ranks altogether this year, seen by many as emblematic of the fall from grace of Brazil the eyes of investors in the past few years. Others argue the brash businessman’s success was a product of the surge of global liquidity, as foreign investors sought out any venture that would deliver a yield, and was atypical of the generally cautious approach of the Brazilian business community. OGX and Mr Batista’s woes came to public attention when the oil company admitted earlier this year that its only producing field was not performing as expected and would be shut down next year. Since then, however, it has fought hard to convince financial markets that it remains a going concern, and recently began production at a new field. Faced with the prospect of even greater losses if the company was liquidated, OGX bondholders will hope that value can be saved by allowing the group to continue operations. Bondholders will receive additional shares in exchange for investing the additional $200m-$215m, under the plan. Óleo e Gás said it will present the restructuring plan to the bankruptcy court in Rio de Janeiro by January 24. The restructuring will be dependent on the approval of another Batista unit, oil services group OSX, which supplies equipment to Óleo e Gas, the oil company said. The two companies together owe a total of $5.8bn.

Shell likely to sell Woodside stake to institutional investors rather than to strategic buyer Royal Dutch Shell’s 23.1% shareholding in Woodside Petroleum to institutional investors rather than to one strategic buyer, according to a wire report. A Reuters report cited bankers who said the stake in the Australian oil company is obviously a potential disposal for Ben van Beurden, who is to start in his role of chief executive of Shell on 1 January. The new CEO will indicate his strategy for Shell when the FTSE-100 energy company announces its 4Q13 results, the item said.

Reuters could not verify Shell’s plans for the stake, the report said. Woodside and Shell refused to comment about any plans for the stake, the article added.

The bankers cited by the report said other global investor-owned energy companies that are large enough to acquire the stake are also looking to sell assets. The article estimated a valuation of about USD 6.4bn (EUR 4.67bn) for the stake.

Strategic buyers, such as the leading Chinese oil companies, and national oil companies of nations such as Thailand or India might be deterred by Shell’s unsuccessful attempt at acquiring outright ownership of Woodside in 2001, the article said.

One banker cited by the report said finding a bidder might prove difficult. Selling the stake would involve a governmental review, the banker added. Although Woodside is no longer of such strategic importance as when Shell’s takeover attempt was blocked, it remains the biggest independent oil and gas group in Australia. That would likely mean that Chinese national oil companies would not be welcome as bidders, the banker said.

The banker added that sovereign wealth funds from Southeast Asia or the Middle East might consider buying small stakes, but added that such groups would be unlikely to buy the entire stake.

The banker argued that Shell would dispose of the stake through a mixture of share placing, strategic sales and probably by Woodside buying back shares.

A second banker cited by the report said potential strategic buyers had bee sounded out about buying the entire stake, but without success. The second banker predicted that Shell would sell the stake to institutional investors via a market placing.

Source Newswire Round-up

Turkey’s Erdogan is under pressure as three cabinet members quit Turkey’s corruption crisis deepened on Wednesday as three cabinet ministers close to Prime Minister Recep Tayyip Erdogan tendered their resignations – among them economy minister Zafer Caglayan and interior minister Muammer Guler, both of whose sons are in prison awaiting trial on corruption charges. As interior minister and head of the police force, Mr Guler was particularly vulnerable as he was ultimately responsible for investigating his own son. Police raids more than a week ago were prompted by what has been revealed as a two-year investigation into bribery, corruption and gold smuggling. Mr Guler’s son, Baris, was discovered with a series of strong boxes in his home as well as a counting machine to keep track of large quantities of cash. Those responsible for conducting the raids have been removed from their posts for conducting the operation without informing their superiors. However, it is the resignation of the third cabinet member, urbanisation and environment minister Erdogan Bayraktar, that may prove most damaging. Mr Bayraktar, a political ally of the prime minister since Mr Erdogan became mayor of Istanbul in 1994, made clear he would not go quietly. He said he was under pressure to resign and, furthermore, to issue a statement that would not put pressure on the prime minister. He added that everything he had done had been with Mr Erdogan’s knowledge. "I declare my resignation from parliament, and as a minister," Mr Bayraktar said. "However, I also believe that to make the people more comfortable, the prime minister should also resign." Mr Bayraktar is not the only one of Mr Erdogan’s erstwhile political confidants to have sparred publicly with him in recent days. Analysts say the corruption charges represent an escalation in the animosity between Mr Erdogan and his former ally, the septuagenarian Islamic cleric Fethullah Gulen, who lives in self-imposed exile in Pennsylvania and has a large following in the Turkish police and judiciary. Prime Minister Erdogan again blamed foreign conspirators for colluding in his government’s problems. In a televised address, he accused "some media and special interests" of betraying the country. Borsa Istanbul, Turkey’s main stock exchange, fell 4.2 per cent on news of the resignations to its lowest level in more than four months. The latest twist in the crisis is likely to aggravate Turkey’s recent economic imbalances by putting further pressure on the Turkish lira. The central bank’s recent decision to defend the currency with reserves, rather than via higher interest rates, may limit inward flows. This, in turn, is likely to have a negative impact on reducing a current account deficit currently running at more than 8 per cent a year.

Softbank enters into final talks with Deutsche Telecom over T-Mobile bid Softbank [TYO: 9984] has entered into final talks with Deutsche Telecom and other relevant parties involved following the group’s decision to buy a majority stake in T-Mobile US [NASDAQ: TMUS] via its unit Sprint[NASDAQ: S], according to Nihon Keizai Shimbun.

The report which did not cite sources, said Softbank was initially considering the acquisition via a share swap, but it is now considering a cash offer in line with Deutsche Telecom's preference. The German telecoms group is expected to agree with the cash offer.

Softbank is expected to finance the acquisition worth more than USD 20bn by bank loans. To this end, the Japanese mobile telecoms group has already started discussions with financial institutions, the report said.

At the end of September 2013, Softbank had JPY 8.84trn in interest-bearing debt, a 2.4-fold increase over the level at the end of March. The group’s interest payments on outstanding loans and bonds will total around JPY 300bn for the year ending March 2015.

Source Nihon Keizai Shimbun

Closing Market Summary: Stocks Post Modest Christmas Eve Gains

'Twas the night before Christmas so few joined the fray The lack of concerted leadership did its part, keeping both buyers and sellers at bay.

The volume was light and trading ranges were tight In fact, the New York Stock Exchange had less than 300 million shares in its holiday sight.

That marked a multi-year low, but did little to stop the glow As the S&P added just over five points to a year-long bull show.

Stocks climbed through the session with cyclical groups serving up the lead To be sure, consumer discretionary (+0.3%) and industrials (+0.5%) padded their status as this year's elite.

The two sectors extended their yearly gains to 39.5% and 36.2%, respectively With their influence being felt on all the indices due to their 22% share of the S&P, collectively.

Like Rudolph, the influential industrials led Santa's aerial charge While discretionary shares, like Dasher or Dancer, paced the convoy of the bearded airborne man at large.

Among commodities, energy (+0.6%) and materials (+1.1%) were boosted by rising oil and gold shining for once Specifically, crude climbed (+0.3%) to $99.21 per barrel while gold (+0.5%) ended at $1203.30 per troy ounce.

On the downside, consumer staples (+0.1%), health care (-0.1%), and financials (+0.2%) lagged modestly But despite their underperformance, the session went off swimmingly.

There were some standouts in the heavyweight sectors, but some few big names found a coal or two On that note, Twitter (TWTR 69.96, +5.42) was boosted by continued momentum, Nike (NKE 77.66, +0.55) climbed on prospects of increasing market share and revenue while Apple (AAPL 567.67, -2.42) shed 0.4% because after yesterday's 3.8% jump, a pullback was simply due.

Over on the bond side, steady selling ensued But despite the five-basis point gain (to 2.99%), the volume remained subdued.

A flurry of data did little to upset the mood Most notably, the Durable Orders report revealed that in October, a solid increase in capital goods orders (+4.5%) was accrued.

There will be no data tomorrow and the exchange will be under lock and key So we'd like to take this opportunity to send you and your family warm Christmas wishes from the Briefing.com family. Nasdaq +37.6% YTD Russell 2000 +36.8% YTD S&P 500 +28.6% YTD DJIA +24.8% YTD