Panel Reviewing BP, Adnoc Offer for Israel's NewMed Seeks Higher Price

Credit: wavemovies/AdobeStock
Credit: wavemovies/AdobeStock

A panel reviewing a $2 billion offer by Abu Dhabi's national oil company and BP to acquire a 50% stake in Israeli gas producer NewMed has recommended raising the asking price by over 10%, casting doubt over the deal, sources said.

The proposed acquisition by Abu Dhabi National Oil Co (ADNOC) and BP was seen as a sign of the strengthening economic links between Israel and the United Arab Emirates since the two countries agreed to normalize ties in 2020.

The independent panel of three members was set up by NewMed after the proposed deal was announced in March to examine the terms of the $2 billion offer and seek competing bids.

The panel, however, did not receive any other offers, according to several sources close to the matter.

Following its deliberations, the panel recommended upping the asking price by 10% to 12%, or roughly up to $250 million, due to the rally in oil and gas prices as well as the depreciation of the Israeli currency in recent months, the sources, who asked not to be named as the matter is private, said.

The committee will now engage with the parties to seek an agreement on the new value for the deal, but there is no guarantee BP and Adnoc would agree to increase their offer, they said.

"There is joint frustration at how the process has been handled and there is real jeopardy of people walking away," a source close to the talks said.

Once the panel concludes the negotiations, it will submit its recommendation to the NewMed board.

BP, Adnoc, and NewMed declined to comment.

Under the non-binding offer, BP and ADNOC would buy 45% of NewMed's free floating shares and an additional 5% owned by Israeli conglomerate Delek Group (DLEKG.TA), which will hold the remaining 50%, taking the company private.

NewMed's shares have risen by over 50% since the March 28 announcement to around 11.50 NIS, but they still remain below the offer price of 12.05 shekels ($3.15).

($1 = 3.8269 shekels)

(Reuters - Reporting by Ron Bousso; Editing by Sharon Singleton)

Current News

New Grid-Scale Offshore Wind-Solar Project Planned for Italy

New Grid-Scale Offshore Wind-S

Wind of Change for Shetland Oil Hub, but Who Will Benefit?

Wind of Change for Shetland Oi

US Offshore Wind: Down but Not Out

US Offshore Wind: Down but Not

Quick Connect: OAL Subsea Pipeline Completed

Quick Connect: OAL Subsea Pipe

Subscribe for OE Digital E‑News

Offshore Engineer Magazine