Gulf Keystone Petroleum and ShaMaran Petroleum Agree to Merge in $601 Million Deal
Gulf Keystone Petroleum Ltd. (LSE:GKP) has agreed to merge with ShaMaran Petroleum Ltd. in an all-stock transaction valuing ShaMaran at approximately $601 million (5.7 billion NOK). Under the deal terms, ShaMaran shareholders will receive 0.07533958 new Gulf Keystone shares for each ShaMaran share held. Following the completion of the merger, existing shareholders of each company will own roughly 50% of the combined group. Additionally, Gulf Keystone plans to pay a special dividend of $50 million to its existing shareholders upon closing.
The combination unites four key assets in the Kurdistan region of Iraq, creating an independent oil producer with working interest 2P reserves of 323 million barrels and pro forma production of 53,000 barrels of oil per day. The combined entity will have a market capitalization exceeding $1 billion, delivering enhanced liquidity and scale. The transaction is supported by major shareholders, including the Lundin family, which holds roughly 25.6% of ShaMaran, and Lansdowne Partners, which manages about 13% of Gulf Keystone.
To complete the transaction, the companies must secure approval from shareholders, requiring a 75% majority vote at Gulf Keystone's extraordinary general meeting and a 66.67% vote at ShaMaran's meeting. The combined company plans to list on the Euronext Oslo Børs regulated market and eventually delist from the London Stock Exchange to consolidate trading on a single exchange.
Key points
- Gulf Keystone Petroleum and ShaMaran Petroleum will combine in an all-stock merger, creating an oil producer with a pro forma market capitalization over $1 billion.
- ShaMaran shareholders will receive 0.07533958 Gulf Keystone shares per ShaMaran share, resulting in a 50-50 ownership split of the combined entity.
- The combined company will hold 323 million barrels of 2P reserves and pro forma production of 53,000 barrels of oil per day across four assets in Kurdistan.
- Gulf Keystone intends to pay a $50 million special dividend to its current shareholders when the transaction closes.
- The deal requires approval from 75% of Gulf Keystone voters and 66.67% of ShaMaran voters at upcoming shareholder meetings.
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What are the terms of the Gulf Keystone and ShaMaran Petroleum merger?
ShaMaran shareholders will receive 0.07533958 new Gulf Keystone shares for each share held, giving shareholders of each company a 50% stake in the combined business. Gulf Keystone also plans to pay a $50 million special dividend to its existing shareholders upon completion.
What will be the production capacity of the combined Gulf Keystone company?
The combined company will have pro forma working interest production of 53,000 barrels of oil per day and combined 2P reserves of 323 million barrels across four fields in the Kurdistan region of Iraq.
Where will the combined Gulf Keystone and ShaMaran entity be listed?
The company intends to list on the Euronext Oslo Børs regulated market and eventually delist from the London Stock Exchange to maintain a single liquid stock exchange listing.