We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Freeport Inks Deal with Anadarko to Divest GOM Properties
Read MoreHide Full Article
Freeport-McMoRan Inc.’s (FCX - Free Report) oil and gas subsidiary, Freeport-McMoRan Oil & Gas (FM O&G) has inked a purchase and sale agreement with Anadarko Petroleum Corporation (APC) for the sale of its Deepwater Gulf of Mexico (“GOM”) properties for a total cash consideration of $2 billion.
The deal includes up to $150 million in contingent payments that will be received over time as Anadarko realizes future cash flows in connection with FM O&G’s recently completed third-party production handling agreement for the Marlin platform. Anadarko will also take charge of future abandonment obligations related to the properties which had a book value of roughly $0.5 billion as of Jun 30, 2016.
The transaction, which is subject to customary closing conditions, is anticipated to close in the fourth quarter of 2016. Preferred shareholders in FM O&G’s consolidated subsidiary, Plains Offshore Operations Inc., are entitled to get $582 million in connection with the deal. The balance net proceeds will be used for debt repayment.
Freeport stated that the agreement will bring its total asset sale transactions for 2016 to over $6 billion and also reflect its commitment to pare debt. The transaction also exhibits the company’s aim at allocating its capital and management resources to its global leading copper business. With the sale transactions announced by Freeport along with its cash flows from operations and earlier announced at-the-market equity transactions, the company is on track to attain its stated balance sheet goals.
Freeport also said that it is beginning consent solicitation to obtain approval from holders of five series of FM O&G Notes to align covenants to those in the existing Notes previously issued by it. Freeport is the guarantor of FM O&G Notes with total principal amounts totaling $2.3 billion. Before completing the Deepwater GOM sale transaction, Freeport plans to merge FM O&G into Freeport, or amend the FM O&G Notes to conform the indentures to Freeport’s Senior Notes.
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Freeport Inks Deal with Anadarko to Divest GOM Properties
Freeport-McMoRan Inc.’s (FCX - Free Report) oil and gas subsidiary, Freeport-McMoRan Oil & Gas (FM O&G) has inked a purchase and sale agreement with Anadarko Petroleum Corporation (APC) for the sale of its Deepwater Gulf of Mexico (“GOM”) properties for a total cash consideration of $2 billion.
The deal includes up to $150 million in contingent payments that will be received over time as Anadarko realizes future cash flows in connection with FM O&G’s recently completed third-party production handling agreement for the Marlin platform. Anadarko will also take charge of future abandonment obligations related to the properties which had a book value of roughly $0.5 billion as of Jun 30, 2016.
The transaction, which is subject to customary closing conditions, is anticipated to close in the fourth quarter of 2016. Preferred shareholders in FM O&G’s consolidated subsidiary, Plains Offshore Operations Inc., are entitled to get $582 million in connection with the deal. The balance net proceeds will be used for debt repayment.
Freeport stated that the agreement will bring its total asset sale transactions for 2016 to over $6 billion and also reflect its commitment to pare debt. The transaction also exhibits the company’s aim at allocating its capital and management resources to its global leading copper business. With the sale transactions announced by Freeport along with its cash flows from operations and earlier announced at-the-market equity transactions, the company is on track to attain its stated balance sheet goals.
Freeport also said that it is beginning consent solicitation to obtain approval from holders of five series of FM O&G Notes to align covenants to those in the existing Notes previously issued by it. Freeport is the guarantor of FM O&G Notes with total principal amounts totaling $2.3 billion. Before completing the Deepwater GOM sale transaction, Freeport plans to merge FM O&G into Freeport, or amend the FM O&G Notes to conform the indentures to Freeport’s Senior Notes.
FREEPT MC COP-B Price
FREEPT MC COP-B Price | FREEPT MC COP-B Quote
Freeport currently carries a Zacks Rank #3 (Hold).
Better-ranked companies in the mining space include Coeur Mining, Inc. (CDE - Free Report) , KAZ Minerals plc and Nevsun Resources Ltd. . All of them carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>