A.P. Moller - Maersk has today completed the sale of Maersk Oil to Total

Published on 08 March 2018

A.P. Møller - Mærsk A/S [A.P. Moller - Maersk] has received all regulatory approvals and has today completed the sale of Mærsk Olie og Gas A/S [Maersk Oil] to Total S.A. [Total], which was announced on 21 August 2017. 

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A.P. Moller - Maersk has transferred its shares in Maersk Oil to Total and as consideration received 97.5 million Total shares equalling USD 5.6bn as of 7 March 2018. In addition to the shares, Total has assumed a short-term debt of USD 2.5bn via a debt push down from A.P. Moller - Maersk into Maersk Oil, which will be repaid to A.P. Moller - Maersk shortly after closing. The proceeds will after customary closing adjustments be used to reduce debt in A.P. Moller - Maersk. 

The accounting gain for A.P. Moller - Maersk amounts to USD 2.6bn. This reflects a locked box interest and the positive development of the Total S.A. share price up to 7 March 2018 and is reduced by Maersk Oil’s net profit realized in the period from 1 July 2017 until closing.

As announced in August, A.P. Moller - Maersk plans, subject to meet-ing its investment grade objective, to return a material portion of the value of the received Total shares to its shareholders during 2018/2019 in the form of extraordinary dividend, share buyback and/or distribution of Total shares.

“I would like to express our appreciation for the commitment demonstrated by Maersk Oil over the past 18 months to uphold a safe and solid performance, while at the same time successfully progressing on major development projects in the North Sea. The focus and results achieved during the time of transition is a testament to the capabilities and professionalism of Maersk Oil’s people,” says Søren Skou, CEO of A.P. Moller - Maersk and continues: 

“With the completion of the Maersk Oil transaction, we have taken a significant step in our strategy to focus A.P. Moller - Maersk on container shipping, ports and logistics”.

Denmark will become a new regional anchor point for Total with strong Copenhagen and Esbjerg bases, which will supervise all of Total’s operations in Denmark, Norway and the Netherlands. Moreover, the Copenhagen office will host the Senior Vice President of To-tal’s North Sea and Russia Business Unit. A new Technical centre is to be established in Copenhagen, supplementing Total’s existing centres in Paris and Pau. Planned development schedules and in-vestments in strategic and sanctioned projects will be upheld.

“We have today secured a financially strong and focused owner of Maersk Oil with a long-term investment interest in the industry. We are very pleased to see Total’s plans to deliver growth, value creation and career opportunities for Maersk Oil’s employees, as well as upholding the long-term investment plans, especially in the Danish part of the North Sea. Based on Maersk Oil’s leading technology position, and its track record as a lean, efficient and trusted partner, Total has made Denmark a regional anchor point for its North Sea business, hereby ensuring a continued Danish stronghold in the North Sea, close to technology and innovation partners at the Danish technical institutions and in the oil and gas service industry,” says Claus V. Hemmingsen, Vice CEO of
A.P. Moller - Maersk and CEO of the Energy division.

It is an integral part of A.P. Moller - Maersk’s purpose to safeguard the long-term viability of its companies by investing in and building value-creating businesses that have a positive impact on society. This is also a guiding principle in the work to define viable solutions for the oil and oil-related businesses. 

“By selling Maersk Oil to Total, a leading global oil major, we have ensured the best possible foundation for the continued development of the people, capabilities and assets, on which Maersk Oil has prospered, creating value to the benefit of both A.P. Moller - Maersk and Denmark,” says Jim Hageman Snabe, Chairman of the Board of A.P. Moller - Maersk and continues: 

“On behalf of A.P. Moller - Maersk, I would like to extend my sincere gratitude to all employees in Maersk Oil for the passion, efforts and devotion to Maersk Oil and A.P. Moller - Maersk displayed by all through the years.” 

As part of the transaction Total will take over all decommissioning liabilities. The Danish Energy Agency's approval of the transfer conditions that A.P. Moller - Maersk assumes secondary liability for the decommissioning costs related to existing Danish offshore facilities corresponding to Maersk Oil's 31.2 % interest in the Danish Under-ground Consortium, should Total be unable to cover such costs. Maersk Oil’s current provision for these decommissioning costs amounts to USD 1.2bn. A.P. Moller - Maersk’s secondary liability will be reduced as part of the redevelopment of the Tyra project as well as future decommissioning of other existing facilities.

Maersk Drilling and Maersk Supply Service remain to have viable solutions established. Improved market conditions in the offshore drilling industry, as well as strategic progress in both businesses has raised A.P. Moller - Maersk’s confidence in finding structural solutions for both before the end of 2018, why they have been reclassified as discontinued operations.

a serious fire in a cargo hold. Enroute from Singapore towards Suez, the vessel is currently positioned around 900 nautical miles southeast of Salalah, Oman. After being unsuccessful in their firefighting efforts, the crew sent out a distress signal and a total of 23 crew members were safely evacuated to the nearby vessel ALS Ceres, which arrived at the scene around 18:30 GMT. Regrettably, four crew members remain missing. The fire onboard the Maersk Honam continues and the situation of the vessel is very critical.

“We’ve received the news of Maersk Honam and the four missing crew members with the deepest regret and are now doing our outmost to continue the ongoing search and rescue operations. This by rerouting our own vessels, with assistance of vessels in the area – most notably ALS Ceres that thankfully acted promptly upon our distress call – and the local authorities,” says Søren Toft, Chief Operating Officer and Member of the Executive Board, A.P. Moller - Maersk.

Search and rescue mission ongoing

The container vessels MSC Lauren, Edith Mærsk and Gerd Mærsk, all enroute in the Arabian Sea, have diverted their routes and are approaching the area with expected arrivals in the early morning Wednesday 7 March local time. Weather conditions in the area are currently fair.

Maersk Line is in the process of informing the relatives of all crew members and acknowledge this is a very difficult time for them.

“The evacuated crew is obviously distressed, with two crew members currently receiving medical first aid onboard the ALS Ceres. We will offer crisis counselling for the seafarers signing-off and returning to their families and our thoughts and deepest empathy go out to the families of the crew members that are still unaccounted for. We will offer them all the support we can in this very difficult situation," says Søren Toft.

The nationalities of the 27 crew members are: India (13), the Phillipines (9), Romania (1), South Africa (1), Thailand (2) and the United Kingdom (1).

The vessel is carrying 7860 containers. All impacted customers will be contacted directly.

The cause of the fire is currently unknown. Maersk Line will investigate the matter thoroughly in cooperation with all relevant authorities. Maersk Honam was built in 2017. It has a nominal capacity of 15262 TEU (twenty-foot equivalent unit), and sails under Singapore flag.



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