Exclusive-Private equity-backed Canadian oil producer Serafina Energy eyes sale -sources
By Shariq Khan and Rod Nickel
(Reuters) – Personal equity-backed Canadian heavy oil producer Serafina Vitality is a attainable sale of the corporate, figuring that top crude costs will increase its worth, sources conversant in the matter instructed Reuters.
The corporate might fetch over C$1 billion ($782 million) if a sale occurs at present commodity costs, one of many sources stated. Serafina, whose property are within the province of Saskatchewan, produced 24,400 barrels of oil per day in 2021, in accordance with the Saskatchewan authorities.
Serafina’s personal fairness house owners Pine Brook Companions and Camcor Companions are searching for to exit their funding made in 2014, and have reached out to potential consumers to gauge curiosity, the sources stated.
The buyout companies haven’t made a last choice on the sale and so they might nonetheless maintain on to the corporate, they added. Personal fairness companies usually exit investments inside three to 5 years.
The sources requested anonymity because the discussions are personal. Serafina, Pine Brook and Camcor didn’t reply to requests for remark.
North American benchmark crude costs rallied to almost 14-year highs following Russia’s invasion of Ukraine. This has inspired personal backers of vitality corporations to exit their investments after years of weak commodity costs pressured them to carry oil-related investments longer than they’d have favored.
North American oil costs stay elevated however have declined 27% since March 7 as Russia and Ukraine have held ceasefire talks. Some bankers have stated this excessive volatility makes it exhausting for consumers and sellers to strike oil sector offers.
The sources stated Waterous Vitality Fund, an acquisitive Canadian personal fairness agency, was evaluating a bid for Serafina.
Adam Waterous, Waterous’s CEO, stated he thinks Serafina could also be bought, however wouldn’t say if Waterous was negotiating to purchase the corporate.
“If one thing occurs with that concentrate on, whether or not it is with us or another person, my prediction is it is months away, not weeks,” Waterous instructed Reuters, declining to say why he thinks a deal might take time.
Waterous-owned Strathcona Sources on Monday stated it had acquired personal oil producer Caltex Sources in addition to the Tucker oil facility in Alberta. A few of Strathcona’s services are in the identical space of western Saskatchewan as Serafina’s.
Serafina makes use of steam to extract crude at its services close to North Battleford, Saskatchewan. Monetary knowledge for the corporate isn’t publicly accessible.
Serafina can be one of many greatest privately owned Canadian oil corporations up on the market. Personal operators Karve Vitality, Mancal Vitality and Allied Vitality are amongst these trying to find consumers of their property, and larger producers Repsol and Imperial Oil are additionally exploring asset gross sales.
($1 = 1.2803 Canadian {dollars})
(Reporting by Shariq Khan in Bengaluru and Rod Nickel in Chicago; Enhancing by Denny Thomas and David Gregorio)
