MILAN (Reuters) - Italy's Eni SpA has agreed to buy Canada's First Calgary Petroleums Ltd in a cash deal worth C$923 million ($865 million), the latest in a series of acquisitions aimed at boosting its oil reserves worldwide.
"The transaction is in line with our strategy of increasing our presence in our core countries, acquiring high potential assets," Eni Chief Executive Paolo Scaroni said in a statement on Monday.
Eni's stock rose 3 percent at 20.85 euros by 3:53 a.m. EDT.
Last year, Eni paid 1.74 billion pounds for oil explorer Burren Energy Plc, which produces oil in the Republic of Congo and gas in Turkmenistan. It also bought Maurel & Prom's stakes in fields in the Congo for $1.43 billion.
First Calgary has been developing natural gas properties in Algeria.
Buying First Calgary would boost Eni's reserves by about 190 million barrels of oil equivalent (mmboe) on a 2p basis in the country, it said. 2p means proven plus probable reserves, an estimate of what the company thinks is likely to be recovered over the life of the fields.
Production start-up is expected in 2011 with a plateau of Eni's share of production of about 30,000 barrels of oil equivalent per day (boepd) by 2012, it added.
UNANIMOUS BOARD APPROVAL
Under the terms of the deal, Eni is to pay First Calgary shareholders C$3.60 per share and convertible debenture holders $108,000 plus accrued interest for each $100,000 par value of bonds.
The deal values the fully diluted share capital of First Calgary at about C$923 million.
First Calgary's board has voted unanimously to approve the deal, Eni said, adding it expected to close it in late 2008.
A group of First Calgary shareholders, directors and officers with about 18.3 percent of the outstanding shares and options have agreed to vote in favor of the deal, it said.
Last Wednesday, First Calgary said it was in talks with parties interested in buying all of the company or significant parts of its assets.
It made the statement following a trade halt on its stock when it jumped more than 40 percent in Toronto. Prior to the halt, it had climbed 96 Canadian cents to C$3.32.
Earlier this year, First Calgary faced a shareholder revolt that was only quelled after its chief executive quit.
"The transaction is in line with our strategy of increasing our presence in our core countries, acquiring high potential assets," Eni Chief Executive Paolo Scaroni said in a statement on Monday.
Eni's stock rose 3 percent at 20.85 euros by 3:53 a.m. EDT.
Last year, Eni paid 1.74 billion pounds for oil explorer Burren Energy Plc, which produces oil in the Republic of Congo and gas in Turkmenistan. It also bought Maurel & Prom's stakes in fields in the Congo for $1.43 billion.
First Calgary has been developing natural gas properties in Algeria.
Buying First Calgary would boost Eni's reserves by about 190 million barrels of oil equivalent (mmboe) on a 2p basis in the country, it said. 2p means proven plus probable reserves, an estimate of what the company thinks is likely to be recovered over the life of the fields.
Production start-up is expected in 2011 with a plateau of Eni's share of production of about 30,000 barrels of oil equivalent per day (boepd) by 2012, it added.
UNANIMOUS BOARD APPROVAL
Under the terms of the deal, Eni is to pay First Calgary shareholders C$3.60 per share and convertible debenture holders $108,000 plus accrued interest for each $100,000 par value of bonds.
The deal values the fully diluted share capital of First Calgary at about C$923 million.
First Calgary's board has voted unanimously to approve the deal, Eni said, adding it expected to close it in late 2008.
A group of First Calgary shareholders, directors and officers with about 18.3 percent of the outstanding shares and options have agreed to vote in favor of the deal, it said.
Last Wednesday, First Calgary said it was in talks with parties interested in buying all of the company or significant parts of its assets.
It made the statement following a trade halt on its stock when it jumped more than 40 percent in Toronto. Prior to the halt, it had climbed 96 Canadian cents to C$3.32.
Earlier this year, First Calgary faced a shareholder revolt that was only quelled after its chief executive quit.
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