Ithaca Energy’s $2 Billion Acquisition Of Chevron North Sea Limited

Herbert Smith Freehills has advised BNP Paribas on a $1.65 billion financing in connection with Ithaca Energy’s acquisition of Chevron North Sea Limited.

The financing provided by BNP Paribas (and to be syndicated prior to financial close) was signed on 29 May 2019 and financial close is expected to complete towards the end of the third quarter, 2019, following approval of the acquisition by the UK Oil and Gas Authority.

The transaction, which sees Ithaca Energy acquire stakes in 10 North Sea oil fields, represents Ithaca Energy’s strategy of growing its exploration and production capabilities and will enable the company to increase output to 80,000 barrels a day.

Ithaca is a wholly owned subsidiary of the Tel Aviv stock exchange listed Delek Group, Israel’s integrated energy company. The acquisition will be funded through an upsized $1.65 billion Reserve Based Lending (RBL) senior debt facility, a $700 million acquisition debt financing facility, an equity investment by Delek and existing cash resources of the company. Ithaca’s existing $300 million term loan and associated Delek guarantees will be retired as part of this refinancing.

JP Morgan is acting as financial adviser to the company in relation to this transaction. The RBL facility has been fully underwritten by BNP Paribas and the acquisition debt financing has been jointly underwritten by JP Morgan and BNP Paribas.

Herbert Smith Freehills advised BNP Paribas with a team led by London finance partner William Breeze (Picture) and senior associates Anita Gulanikar and Rakhee Patel, with support from Michael Poole and Mika Morissette.

Involved fees earner: William Breeze – Herbert Smith Freehills; Anita Gulanikar – Herbert Smith Freehills; Mika Morissette – Herbert Smith Freehills; Rakhee Patel – Herbert Smith Freehills; Michael Poole – Herbert Smith Freehills;

Law Firms: Herbert Smith Freehills;

Clients: Ithaca Energy;