Cnooc’s CEO says not looking for new acquisitions


Cnooc’s CEO says not looking for new acquisitions

CALGARY -- Cnooc’s CEO said that they are not looking for any new acquisitions in the near term after completing its $15.1 billion takeover of Nexen.

Speaking to reporters after closing the deal earlier this week, Li Fanrong said the Nexen purchase is expected to boost Cnooc's production 20% y-o-y, and Nexen's portfolio of assets provides significant growth opportunities. It will boost Cnooc's reserves by 30%, he said.

Mr. Li said, "This is a big deal for any company to pay more than $15 billion. In the very short term, I'm not looking for any other acquisitions. My priority is to get this operation right. We need to better realize the full potential of Nexen's resources."

The Cnooc-Nexen deal ranks as the fifth-largest acquisition of a Canadian company by a foreign one, according to Dealogic. It's the largest foreign acquisition to date by a Chinese firm.

Cnooc required Canadian, United States and United Kingdom’s approval for the deal. In addition to oil sands and shale gas operations in Canada, Nexen holds significant energy assets in the Gulf of Mexico and offshore Britain. Mr. Li didn't disclose details of the three government-approval processes beyond what the company has previously disclosed. Cnooc will also list its shares on the Toronto Stock Exchange.

The Committee on Foreign Investment in the United States (CFIUS), an interagency group that signs off on strategic foreign investments, was the last government agency to approve the deal. Cnooc and Nexen executives declined to disclose details of that approval process.

We're not going to get into that. We can't get into the elements of the deal, because of confidentiality reasons said Kevin Reinhart, Nexen's CEO, who will continue to lead Nexen businesses.

The deal was approved by the Canadian government late last year after a lengthy review to determine whether the takeover was of net benefit to Canada's economy, a threshold required by federal law for foreign takeovers.

Dow Jones Newswires

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