Devon Energy Announces C$3.125 Billion Sale of Canadian Conventional Assets
February 19 2014 - 7:00AM
Business Wire
Devon Energy Corporation (NYSE:DVN) today announced that it has
entered into a definitive agreement to sell the majority of its
Canadian conventional assets to Canadian Natural Resources Limited
for C$3.125 billion, or US$2.8 billion using the current exchange
rate. The sale excludes the company’s Horn River, Lloydminster and
thermal heavy oil assets located in Canada. At December 31, 2013,
proved reserves associated with the divestiture totaled
approximately 170 million barrels equivalent. The transaction is
subject to customary terms and conditions and is expected to close
early in the second quarter of 2014.
Upon close of the transaction, the company plans to immediately
repatriate the proceeds to the U.S. for use in the repayment of
debt incurred to finance its Eagle Ford acquisition. The company
expects net proceeds of US$2.7 billion after adjusting for currency
exchange and taxes associated with the sale and repatriation of the
funds to the U.S.
“This agreement represents a significant step forward in the
execution of our non-core divestiture process,” said John Richels,
president and chief executive officer. “This tax-efficient
transaction provides for a clean exit from our Canadian
conventional business at a value of nearly 7 times 2013 EBITDA, a
substantial premium compared to Devon’s current trading multiple.
Furthermore, the timely execution of the largest piece of our
non-core divestiture process accelerates the refocus on core
assets.”
The divestiture process is ongoing for the company’s remaining
non-core properties in the U.S. Devon expects to complete these
U.S. divestitures by year end.
Advisors
Scotia Waterous acted as lead financial advisor to Devon on the
transaction. BMO Capital Markets also acted as a financial advisor
to Devon on the transaction and has provided a fairness opinion to
the Board of Directors of Devon. Osler, Hoskin & Harcourt LLP
acted as legal advisor to Devon.
Devon Energy Corporation is an Oklahoma City-based independent
energy company engaged in oil and gas exploration and production.
Devon is a leading U.S.-based independent oil and gas producer and
is included in the S&P 500 Index. For additional information,
visit www.devonenergy.com.
Devon Energy CorporationInvestor ContactsScott Coody,
405-552-4735orShea Snyder, 405-552-4782orMedia ContactChip Minty,
405-228-8647
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