German chemical company BASF is in discussions regarding a potential merger of its oil and gas unit Wintershall with Letter One’s oil and gas activities bundled in the DEA Group.
BASF would hold the majority of the shares in the joint enterprise, the company said in a press release on Friday.
An Initial Public Offering (IPO) of the joint enterprise would be an option in the medium term. The outcome of the discussions is open and there is no assurance that any transaction will be consummated, the company further added.
BASF’s oil and gas activities are bundled in the Wintershall Group, which focuses on exploration and production in oil and gas-rich regions in Europe, North Africa, Russia, South America and the Middle East.
Together with Gazprom, the company is also active in the transport of natural gas in Europe. For the full year 2016, net sales of the Oil & Gas segment of the BASF Group amounted to around €2.8 billion, EBITDA was around €1.6 billion and EBIT around €500 million.
BASF does not intend to make any additional comments on this matter at this time, the company concluded.
Letter One, the Luxembourg financial holding company, bought DEA in early 2015.