Talisman Energy Confirms Talks With Repsol

(RTTNews) - Canadian oil and gas company Talisman Energy Inc. (TLM, TLM.TO) confirmed Monday that it is in talks with Spanish oil company Repsol S.A. (REPYY.PK) about a "potential corporate transaction". Talisman Energy also said it has been approached by a number of other parties regarding various transactions. The company's shares are gaining almost 25 percent in pre-market trades.

"There can be no assurances that these discussions will result in a transaction or on what terms. Until such time as it is appropriate to make a public announcement on a potential transaction, Talisman does not intend to make any further comment on this matter," Talisman Energy said in a statement.

Media reports last week indicated that Repsol is seeking to acquire Talisman Energy in a deal that would value the company's equity at up to C$8 billion, or $6.90 billion. Repsol executives reportedly traveled to Calgary, Alberta and were negotiating a takeover bid for Talisman Energy in a range of C$6 to C$8 per share.

Respol, which is seeking to expand beyond Spain, sees Talisman's energy assets in the North America and Asia Pacific as a growth opportunity.

Repsol is said to have dropped a plan to acquire Talisman in August 2014 after concluding due diligence on the company. Talisman confirmed in late July that it was approached by Repsol "with regards to various transactions".

However, Repsol has recently revived talks with Talisman, as the Spanish company seeks to boost its presence in North America through acquisitions. The fall in oil prices to fresh five-year lows has made companies like Talisman more attractive targets.

In early November, Talisman Energy reported a profit for the third quarter, compared to loss in the year-ago period. The results reflected mainly mark-to-market gains on commodity derivatives that helped offset lower revenues. total production for the quarter declined 5 percent, primarily due to sale of the company's Montney, Monkman and Ojay dry gas assets this year.

TLM closed Friday's trading on the NYSE at $4.29. In Monday's pre-market activity, the stock is up $1.06 or $24.71 to $5.35.