Could Anadarko Petroleum Corp. (NYSE:ACP) be on the acquisition trail? The Woodlands, Texas, oil and gas explorer just rolled out a $1.6 billion secondary offering of 34.5 million shares led by UBS Investment Bank and Barclays Capital, saying the proceeds would be used for "general corporate purposes," including future capital expenditures, which, according to SEC documents, could include buying more acreage in offshore West Africa and further developing its prospects in the Marcellus shale in Appalachia.
Houston energy investment bank Tudor Pickering Holt & Co. Securities Inc. thinks those "capital expenditures" might be an acquisition of all or part of Dallas explorer Kosmos Energy LLC. Anadarko spokesman John Christiansen said he couldn't comment on the offering or the rumors. A Kosmos spokesman couldn't be reached.
Anadarko and Kosmos are exploration partners off the coast of Ghana, which may be on the cusp of an oil and gas boom. This past March, Anadarko announced it encountered 70 feet of net pay in the Tweneboa-1 discovery well, and an acquisition of Kosmos would give it a controlling interest in the Teak prospect in the West Cape Three Points Block and operatorship and double its 18% stake in the Onyina prospect in the Deepwater Tano License, which is 49.95% owned by Tullow Oil plc.
Kosmos is a privately held gas explorer started by former executives at Triton Energy, which was initially backed by Hicks Muse Tate & Furst, went public and then was sold to Amerada Hess Corp. (NYSE:HES) in 2001 for $3.2 billion -- thrice what the private equity firm put in. Kosmos is backed by Warburg Pincus and Blackstone Capital Partners -- $300 million in 2003 and $500 million in 2008. Warburg is thought to own 55% and Blackstone 45%.
Pickering noted that Anadarko avoided equity after its $23 billion purchase of Kerr-McGee Corp. and Western Gas Resources Inc. in 2006, but said the current opportunity "justifies adding capital."
This past October Anadarko CEO Jim Hackett said on the sidelines of the Mergers and Acquisitions Institute in Houston that the company would consider a smaller acquisition but was more focused on organic growth. Times -- and Anadarko's prospects off the coast of Africa -- have changed a lot since then.
- Claire Poole
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