Forest Oil sells Texas fields that may raise US$1 Billion
Forest Oil Corp intended to sell its oil and natural gas fields that could be found in Texas Panhandle. The sale was expected to raise up to US$1 billion. This amount was more than the corporation's market value.
JPMorgan Chase & Co. was hired by the Denver-headquartered company. JPMorgan would look for potential buyers of approximately 100,000 acres. This would include producing wells. According to a filing reported today, the sale would transpire after the company received unsolicited bids.
Robert W. Baird & Co.'s Milwaukee-based analyst, Maggie Savage, assessed the assets to be worth US$900 million to US$1 billion. Patrick R. McDonald, Forest's Chief Executive Officer, stated that the income from the sale would be utilized to pay debt. The information compiled by Bloomberg reported that as of March 31, Forest's debt was around US$1.6 billion.
Today, Forest's market value was roughly US$572.6 million. Following this year's 28% plunge in the share price, the company suffered depreciation.