Conoco enters into exclusive talks to sell U.K. assets to Ineos

By Alex Nussbaum on 11/18/2018

NEW YORK CITY (Bloomberg) -- ConocoPhillips is in exclusive talks to sell its U.K. oil and gas fields, said to be valued at as much as $3 billion, to British billionaire Jim Ratcliffe’s Ineos Group.

The U.S. explorer plans to invite bids by the end of the year for the assets, which would include what’s left of its holding in the Clair Field, Bloomberg News first reported last week. The oil major on Sunday said the negotiations with Ineos won’t include its Teesside or London assets, and declined to comment any further.

Ineos has put down a deposit in return for three months’ exclusivity in negotiations, the Sunday Times reported earlier, without saying where it got the information. HSBC Holdings Plc and Citigroup Inc. are poised to provide financing, the newspaper said.

The interest from Ineos underscores Ratcliffe’s appetite for dealmaking, fueled in part by earnings from his North American operations. His company last week agreed to buy a resins business from Ashland Global Holdings Inc. for $1.1 billion. The billionaire has built Ineos from scratch by borrowing and buying assets from companies including BP Plc, though the 2008 financial crisis had forced him to tap the brakes for a while.

Conoco, on Wednesday, confirmed that it’s marketing the U.K. assets after receiving an unsolicited offer, and said it would retain the business if proposed bids don’t meet its expectations. Private equity firms Neptune and Chrysaor are expected to take an interest if the talks with Ineos fail, according to the Sunday Times.

Conoco, in July, announced a North Sea-for-Alaskan asset swap with BP. As part of that transaction, the Houston-based firm agreed to divest a 16.5% stake in the Clair Field for an undisclosed amount while retaining a 7.5% interest.

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