Exxon Mobil likely to Sell Its 19% Stake in New Zealand Refining
Following reports that Exxon Mobil Corp. will become the second major shareholder to put its stake in New Zealand Refining Co. up for sale; the operator of the nation’s sole oil refinery fell in Wellington trading.
For the first time in six days, the stock plunged, following the Independent newspaper reports that Goldman Sachs JB Were Ltd. has been hired by Exxon, in order to find a buyer for its 19 percent stake in the plant, related storage facilities and 183 New Zealand petrol stations.
Both Exxon spokesman, Alan Bailey and Andrew Barclay of Goldman’s investment banking unit in Auckland, declined to comment.
It has appeared that already Royal Dutch Shell Plc is finding a buyer for its 17 percent holding in New Zealand Refining; and the recent Exxon news comes at a time when new capacity in Asia is forecast to depress margins in the region for the next two years.
Following the lowering of prices by the sellers, investments in existing plants have become profitable again, said Valero Energy Corp., the largest U. S. refiner last month.
Rickey Ward, who helps manage the equivalent of $2.3 billion at Tyndall Investment Management in Auckland, stated: “It’s unfortunate for the company that they have an overhang of stock. There’s no guarantee that it will come to a capital market. There are clearly other potential buyers of these assets whether they are from Asia or further afield.”
A fall by 5 cents to NZ$7 was seen in New Zealand Refining at 3 p. m. in Wellington, valuing Exxon’s stake at NZ$322 million ($213 million). After Shell announced in February that it was reviewing the asset and its filling stations as part of a global focus on exploration and production, there has been drop by 4% in stock.
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