ITOCHU Corporation Partners with KKR to Acquire Samson Investment Company
November 24, 2011
ITOCHU Corporation (headquarters: Minato-ku, Tokyo; President and CEO: Masahiro Okafuji; hereinafter “ITOCHU”) has reached an agreement with Kohlberg Kravis Roberts & Co. L.P. (headquarters: New York, USA; Co-CEOs: Henry R. Kravis and George Roberts) to jointly acquire 100% share of Samson Investment Company (headquarters: Tulsa, Oklahoma, USA; hereinafter “Samson”) excluding its onshore Gulf Coast and offshore deep water Gulf of Mexico assets which will be retained by the seller.
ITOCHU, as a strategic investor, will own 25% of Samson through JD Rockies Resources Ltd., a 100% owned subsidiary of ITOCHU. Consideration for the 25% ownership interest will be approximately US$1.04 billion (approx. ￥78 billion). In addition, ITOCHU will obtain the rights to offtake natural gas produced from Samson’s assets (approx. 1 million tons per annum equivalent at peak rate) ,which Itochu intends to use to ultimately support a potential future LNG export business to Asia.
Samson has a strong track record of drilling and operational success and a unique portfolio of assets. The company is one of the largest private exploration and production companies in the United States, with interests in over 10,000 wells, of which it currently operates over 4,000 wells. In recent years, Samson acquired unconventional resource assets with competitive costs and has built a balanced portfolio of oil and gas assets.
Globally, ITOCHU plans to increase its equity share in oil and gas operations from 34,000 barrels of production per day to more than 70,000 barrels per day by 2015. This investment is a key step in achieving this target. It will also allow ITOCHU to diversify its oil and gas investment activities to unconventional projects and grow its natural gas / LNG trading activities. ITOCHU will continue its efforts to strengthen its natural resources portfolio.
Mizuho and Evercore Partners acted as the financial advisor to ITOCHU.
|Company||Samson Investment Company.（non-listed）|
|Headquarters||Tulsa, Oklahoma, USA|
|Industries||exploration, development, and production of US onshore oil and gas|