ANADARKO’S REJECTED BID FOR APACHE MEANS LESS WORK FOR MAPSEARCH
While it’s doubtful that the workload of GIS data providers played a pivotal role in Apache Corp.’s decision to reject an unsolicited bid from Anadarko Petroleum Corp, you can be sure that the MAPSearch team is not going to complain. I jest of course, because the reality of covering the energy sector is that M&A activity is always occurring. Our professional research and GIS teams have plenty of experience handling these kinds of transactions. And that is a good thing because the low-price environment we’re currently experiencing has only served to fuel the fire of consolidation throughout the industry.
So what does happen on the back-end when a buyout occurs? To better illustrate how a major transaction affects the MAPSearch data, I’ll use the would-be acquisition of Apache by Anadarko as an example. Currently in our database we have Apache as the owner of the following:
· 266 facilities
· 3,664 miles of pipeline
· 10 subsidiaries
To say that the legal structure of large oil & gas corporations is complex would be an understatement. The real burden on research comes from determining how the acquiring firm will absorb the assets of each subsidiary. For instance, will new subsidiaries be created or will all assets fall under the umbrella of a new holding company? In addition to ownership, there may be changes to the operating companies as well. By the end, a transaction on this scale can lead to thousands of attribute changes to the MAPSearch database.
So, ironically, while we’re all a little relieved that this particular takeover fell through, Bloomberg is reporting that it may leave both companies vulnerable to acquisition. Oh well, such is life in the energy GIS industry.