NAIROBI, Kenya, April 15 – Tullow Overseas Holdings BV has signed a heads of terms agreement with Gulf Energy Ltd to sell its Kenyan unit for Sh15.6 billion ($120 million).
The payment will be structured in three phases, starting with an initial Sh5.2 billion ($40 million) payable upon completion of the deal.
An additional Sh5.2 billion ($40 million) will be payable upon the earlier of Field Development Plan (FDP) approval, while the remaining Sh5.2 billion ($40 million) will be paid over five years starting from the third quarter of 2028.
“In addition, Tullow will be entitled to royalty payments subject to certain conditions. Tullow also retains a back-in right for a 30% participation in potential future development phases at no cost,” the company said in a statement.
Tullow added that the transaction is expected to enhance both its equity and leverage positions and accelerate its deleveraging strategy.
“This transaction will constitute a significant transaction for the purposes of UKLR 7 of the UK Listing Rules (as came into effect on 29 July 2024). Further announcements will be made in due course upon full-form transaction documentation being entered into by the parties,” the statement added.
