Freeport under fire for $9-billion energy deal
Dec 06, 2012 | 04:33 PM
| Samuel Frizell
NEW YORK Freeport-McMoRan Copper & Gold Inc.s share price logged a double-digit decline Wednesday after the company announced its $9-billion push into the energy business, with analysts criticizing the move as an unhappy marriage between two incompatible industries.
"I dont see any reason why these two disparate sets of assets need to be together," Daniel Rohr, an analyst at Chicago-based Morningstar Inc., told AMM. "Theres nothing complementary here."
Freeport on Wednesday announced definitive plans to acquire oil and gas producer Plains Exploration & Production Co. for $6.9 billion in cash and stock, as well as oil and gas producer McMoRan Exploration for $3.4 billion in cash, or $2.1 billion net after taking into account the copper and gold miners and Plains Explorations existing stakes in the business. Included in the deal are Plain Explorations oil and gas assets in the Gulf of Mexico, onshore production at Eagle Ford in Texas and Haynesville, La.; and oil production facilities in California (amm.com, Dec. 5). ....
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