Plains Exploration & Production ("PXP") has completed the divestment of its Gulf of Mexico shallow water shelf properties to McMoRan Exploration. The transaction was approved by McMoRan shareholders at a special meeting of the stockholders held today. At closing and after preliminary closing adjustments, PXP received approximately $86 million in cash, which includes $11 million in working capital adjustments, and 51 million shares of McMoRan common stock in exchange for all of PXP's interests in its Gulf of Mexico leasehold located in less than 500 feet of water.
PXP has designated James C. Flores, PXP's Chairman of the Board, President and Chief Executive Officer, and John F. Wombwell, Executive Vice President, General Counsel and Secretary of PXP, to McMoRan's Board of Directors.
James C. Flores, Chairman of the Board, President and Chief Executive Officer of PXP commented, "The Gulf of Mexico shallow water ultra-deep exploration program has been and continues to be a successful value creation strategy, and we look forward to our future participation as a significant McMoRan shareholder. The unique operator/ownership structure approved today maximizes value for both PXP and McMoRan shareholders from the ultra-deep program's current discoveries and exploration potential, and through PXP's ownership position, PXP shareholders maintain growth exposure to this dynamic and emerging play without substantial capital requirements."
Barclays Capital and Jefferies & Company acted as advisors to PXP on the transaction.
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