Adnoc and BP suspend bid for Israel’s NewMed Energy

ReutersAri Rabinovitch

• Proposed stake was for $2bn
• Gaza war has ‘created uncertainty’
• Shares in company down 6%

Abu Dhabi state oil company Adnoc and BP have suspended a proposed $2 billion bid to buy a major stake in Israel’s NewMed Energy as a result of the ongoing conflict in Gaza.

The Tel Aviv Stock Exchange-listed natural gas operator, part of the Israeli conglomerate Delek Group, said on Wednesday that the deal was being put on pause “due to the uncertainty created by the external environment”.

Under the non-binding offer signed in March last year, BP and Adnoc would buy 45 percent of NewMed’s free floating shares and an additional 5 percent owned by Delek Group, which would hold the remaining 50 percent, taking the company private.

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At the time, BP said the proposed transaction would “strengthen the broader strategic partnership between Adnoc and BP across oil and gas, hydrogen and carbon capture and storage technology”.

The statement from NewMed Energy said the consortium remained interested in the deal, which was already being held up over regulatory issues.

But it added that the suspension will remain “until such time as discussions resume or the process is terminated”.

• Shares soar at Israeli energy giant after BP and Adnoc offer
• Adnoc’s acquisition strategy could lead to something major
• War puts Israel’s big plans for gas exploration in jeopardy

“There can be no certainty that discussions will resume or that an agreement will be reached in the future, nor as to the terms of an agreement should one be reached,” it said.

Shares in NewMed Energy fell by 6 percent in Tel Aviv on Wednesday.

Delek Group holds just over 45 percent of the Leviathan Reservoir, the largest gas reservoir in the Mediterranean, which serves as a key source of energy for Israel and neighbouring countries.