Verenex: Running out of time
Verenex running out of time for China deal
Canada's Verenex Energy is running short of time to get Libyan approval for its $460 million sale to China, making some investors pessimistic that the deal will go ahead.
Verenex needs Libyan consent by 24 August for the China National Petroleum Corporation (CNPC) deal to go ahead.
While Libya has said it will pre-empt the bid, it has not made a formal offer and has not given consent to the Chinese deal, reported Reuters.
Investors in Verenex were prepared for the possibly of the deal collapsing, but some said they still expected Verenex and the Chinese to continue to seek Libyan approval for the C$10-a-share sale.
"I think it's done, it's over," said one holder of Verenex shares who declined to be identified. "The Libyans have all the leverage -- they can do what they want and they are going to."
Verenex said on 10 August it was still seeking Libyan consent for the company's sale to CNPC, but the company has put together a draft arbitration claim for use as a last resort.
"Clearly neither party wants to go the legal route on this thing, and we're trying to figure out the best way to come up with an amicable solution," Verenex boss Jim McFarland told Reuters in July.
He could not be reached for comment by Reuters yesterday and today.
Shokri Ghanem, the chairman of Libya's National Oil Corporation (NOC), has repeatedly said the NOC will match the CNPC offer. He declined to comment on Verenex when contacted by Reuters yesterday.
With the assumption of debt, the offer from CNPC was worth C$499 million(US$460 million), the companies said back in February when the deal was announced.