Union Texas tender offer still on despite unrest<\/p>\n
NEW YORK (Reuters): Atlantic Richfield Co. said on Monday that
\nits planned $3.3 billion acquisition of Union Texas Petroleum
\nHoldings Inc. would not be derailed by escalating unrest in
\nIndonesia, where both have large interests.<\/p>\n
\"The tender offer remains in effect,\" said Al Greenstein, a
\nspokesman for the Los Angeles-based oil major.<\/p>\n
Violence in Indonesia, where 37 percent of Union Texas's
\nreserves and 49 percent of 1997 production are located, has
\npushed the Houston-based company's shares down around $27.81
\neach, below the $29 per share offered by ARCO on May 4 and off a
\n$28.75 closing high following the deal's announcement.<\/p>\n
ARCO stock fell 75 cents on Monday to $79.06, off from
\nThursday's close of about $80.81.<\/p>\n
While noting that most of Union Texas's Indonesian operations
\nare a long way from the violence of urban centers, BT Alex. Brown
\nanalyst Adam Sieminski said concerns that oil and gas operations
\nthere could be affected had hit the share price of both
\ncompanies.<\/p>\n
\"The market got jitters that ARCO might use the unrest as an
\nexcuse to amend or unwind its purchase agreement...These concerns
\nseem largely exaggerated in our view,\" he said.<\/p>\n
Union Texas said it had evacuated 15 expatriate employees and
\ntheir families from Jakarta, adding that its oil and gas wells in
\nthe country, mostly in Kalimantan, continued pumping.<\/p>\n
\"There has been no disruption at our operations,\" said
\nspokeswoman Carol Cox.<\/p>\n
The current spate of political violence in Indonesia has
\nclaimed 500 lives and forced a number of foreign companies to
\nevacuate employees.<\/p>\n
ARCO announced last week that it would evacuate its foreign
\nworkers and their families, around 320 people, from the troubled
\nAsian country, after saying \"the scope for violence\" in Indonesia
\nhad increased.<\/p>\n
Indonesia accounts for around five percent of ARCO's
\nhistorical earnings and Greenstein too said that output was
\ncontinuing on schedule.<\/p>",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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