DataRoom AM: Apache cry

Buyers of Apache’s remaining oil and gas assets vanish as global crude prices continue to crumble, while local energy firms look ripe for takeover.

Apache Corporation’s plan to further withdraw from Australia appears to be on the backburner as retreating oil prices see potential suitors shy away from putting forward any significant offers for its assets.

Elsewhere, a number of local oil and gas firms are rumoured to be takeover targets, a joint venture between Foxtel and Seven West Media is considered likely to get the green light from the competition watchdog and investors eye a float of MYOB to kick start the IPO market in 2015.

Energy heavyweight Apache Corporation may have called off the hunt for buyers of over $3 billion worth of oil and gas assets in Western Australia. The US group offloaded its stake in the giant Wheatstone LNG project to Woodside Petroleum in December alongside its interest in the Balnaves oil project in Australia and the Kitimat LNG development in Canada. However, an auction of its remaining oil and gas assets in WA has reportedly been put on ice as buyers go cold in the wake of the ongoing slump in oil prices.

Apache’s remaining local assets -- including the Phoenix South Discovery in the Canning Basin -- had allegedly drawn interest from Santos and Origin Energy, but both firms have retreated into cash preservation mode as the energy sector faces a more turbulent environment.

The oil slump is, however, putting a target on a few backs as stock price weakness places a number of local firms in the sights of offshore predators. Among the most likely targets put forward by analysts are Beach Energy and Senex Energy, while long-awaited deals between Cooper Basin players such as Beach, Senex and Drillsearch Energy could also be on the cards.

In media, The Australian Financial Review reports the ACCC is likely to waive through a streaming joint venture between Foxtel and Seven West Media. The planned deal has reportedly received no objections from rivals in the fledgling sector as streaming wars set to capture the public’s attention in 2015.

In the IPO market, bankers are preparing for a quieter year for ASX listings even if a few big deals are set to capture broad attention. The first major deal is tipped to be a March float of Bain Capital’s MYOB, with the accounting software group likely to command a valuation around $3bn. While the number of IPOs may slip, bankers are bullish about a cashflow boost from the completion of major block trades.

Among those on the immediate agenda are the potential for management shareholders to offload their stakes in Cover-More and OzForex after escrow periods came to an end late last year. Smartgroup and Genworth Australia could also be ripe for block trades after quarterly results next month.

Elsewhere, Crown Resorts is considered capable of holding onto its investment grade ratings despite heavy capex spending plans without diluting shareholders. Instead, analysts believe James Packer’s casino giant could raise hybrid debt or bring in new joint venture partners on a variety of projects in Australia and around the world.

The reports come as Crown’s expansion plans could be tempered with a new president in Sri Lanka likely to provide a lethal blow to the firm’s plan to build a $500m casino in the country. 

Finally, Woodside has signed an MoU with conglomerate Adani as it seeks to further its exposure to the Indian LNG sector, while IPO candidate Spring FG is hoping to raise $4m through its float to fund a bold acquisitive streak in the financial services sector.