Beach Energy completes acquisition of Drillsearch Energy for $273m

Beach Energy has completed its acquisition of Australia-based Drillsearch Energy in a transaction worth A$384m ($273m).

Following the acquisition, Drillsearch is now a wholly owned subsidiary of Beach Energy.

The merger will create a company that will have a combined FY2015 production of 12.1 MMboe and an expanded portfolio of oil, gas and infrastructure assets.

Beach Energy acting CEO Neil Gibbins said: “This has been a well supported transaction given the complementary nature of Beach and Drillsearch’s asset portfolios, and completion marks a significant milestone in the history of both companies.

“From Beach’s perspective, the merger provides an additional 19,000km² of gross acreage within our core Cooper Basin area.

“It delivers full ownership of our key Western Flank oil and gas permits, expands our gas and gas liquids acreage, and provides an enlarged exploration footprint.”

Beach Energy’s focus will be on integration, which will initially target cost reductions as well as portfolio optimisation, and is expected to be completed by 30 June.

This will allow a major portion of the expected $20m in synergies to be realised during FY17. The merger will provide both Beach Energy and Drillsearch Energy shareholders exposure to a diverse Cooper Basin business.

The combination is based on the strategic rationale of unlocking value from an existing partnership, in which Beach already operates the Western Flank Oil Fairway joint venture and the Western Wet Gas joint venture.

In addition, the new company will be in a position to take advantage of future growth opportunities.

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Image: The merger will create a company that will have an expanded portfolio of oil, gas and infrastructure assets. Photo: courtesy of suwatpo / FreeDigitalPhotos.net.