Petron completes purchase of Exxon Mobil units in Malaysia

- Neil Jerome C. Morales () - April 3, 2012 - 12:00am

MANILA, Philippines - The Malaysian unit of oil giant Petron Corp. has completed its nearly $600-million acquisition of Esso Malaysia Berhad (EMB) and its two subsidiaries.

The development formalized Petron’s goal of increasing its presence in Malaysia and Asia in general.

“We advise that Petron Oil & Gas International Sdn Bhd, a subsidiary of the company, has completed the acquisition of 65 percent of EMB,” Petron said in a disclosure to the local bourse.

Petron Oil & Gas also completed on March 30 its purchase of the 100-percent stake in ExxonMobil Malaysia Sdn Bhd and 100 percent of ExxonMobil Borneo Sdn Bhd from American oil and gas giant ExxonMobil Corp.

The aggregate purchase price for the three firms reached $577.3 million, Petron said.

In August, Petron announced its acquisition of 175.5 million ordinary shares or 65-percent stake in EMB, which is listed in the Malaysian stock exchange. It also signed a deal to buy unlisted subsidiaries ExxonMobil Borneo Sdn Bhd and ExxonMobil Malaysia for $404 million, bringing the total transaction to $610 million.

Petron said it bought the EMB shares from ExxonMobil International for $195.12 million or 598.7 million Malaysian ringgit as the foreign exchange rate was finalized only on March 29.

The deal resulted in a voluntary tender offer for the remaining 94.5 million shares held by the public at an offer price of 3.59 Malaysian ringgit or a total of 339.26 million Malaysian ringgit (roughly $111 million).

Last week, Petron president Eric O. Recto said EMB’s refinery needs additional investments while its network has room for growth.

EMB’s operations in that country include a refinery located in Port Dickson on the west coast with a capacity of 88,000 barrels per day, seven fuel distribution terminals, and a network of about 560 retail stations, of which 420 are company-owned.

The Port Dickson refinery currently produces a range of products including gasoline, diesel, liquefied petroleum gas, jet fuel, kerosene and low-sulfur waxy residue. Petron plans to invest up to $1.2 billion to upgrade the refinery.

Recto said Petron is also interested if Esso (Thailand) Public Co., Ltd., another unit of ExxonMobil, will be offered for sale.

Conglomerate San Miguel Corp. (SMC) owns 68 percent of Petron, the Philippines’ largest oil refining and marketing company with crude distillation capacity of 180,000 barrels per day and over 1,700 service stations.

SMC, in the last few years, has diversified its core portfolio of food, beverage and packing by expanding its participation in industries such as petroleum, power generation and distribution, mining and infrastructure.

BORNEO SDN BHD CONGLOMERATE SAN MIGUEL CORP ERIC O ESSO MALAYSIA BERHAD EXXONMOBIL GAS INTERNATIONAL SDN BHD IN AUGUST MILLION PETRON PETRON OIL PORT DICKSON
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