Exclusive: Maersk, DONG oil and gas merger talks stall over price - sources
- COPENHAGEN/LONDON Talks between shipping group A.P. Moller-Maersk (MAERSKb.CO) and DONG Energy (DENERG.CO) to merge their oil and gas business have stalled after the two Danish firms could not agree on a price, industry and banking sources said on Wednesday.The breakdown in talks aimed at creating a joint company worth more than $10 billion may open the door for other bids for DONG's operations, which it is spinning off as it moves away from fossil fuels to focus on offshore wind, the sources said.Maersk entered talks with DONG in November after announcing plans to merge or spin off its energy assets as part of a major restructuring to shift the company's focus to its transport and logistics businesses.The development will be a blow for Maersk, which said on Tuesday it may consider selling assets or cutting dividends as it seeks to retain its credit rating, which is at risk.
- Nevertheless, Morgan Stanley analysts said in a note this week that all of Maersk's energy units remained under pressure due to sluggish markets and finding ways to cut costs.Deal making in the North Sea has slowed in the past few years partly as a result of a global oil price slump and a sharp rise in the number of assets offered for sale in the aging basin.
- Companies such as Royal Dutch Shell (RDSa.L), ConocoPhillips (COP.N) and French utility Engie (ENGIE.PA) are seeking to sell their North Sea operations.DONG produced 89,000 barrels of oil and gas per day in 2016, down from 115,000 barrels daily last year.
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