16 December 2013, News Wires – Cash-strapped Harvest Natural Resources has signed on the dotted line for its proposal to exit Venezuela in two divestments to Argentina’s Pluspetrol worth a total of $400 million.
Chief executive James Edmiston said the Houston-based explorer had “set a clear path for our amicable exit from our Venezuelan business while at the same time allowing us to redeem our outstanding debt”.
Harvest said that it had now closed the first part of the proposed deal unveiled in late November, under which Pluspetrol has bought 29% of Harvest’s 80% stake in Venezuelan arm Harvest-Vinccler Dutch Holding (HVDH) for $125 million cash.
A share purchase agreement has been signed for the second transaction under which Pluspetrol will buy the other 51% of the HVDH stake for $275 million.
The larger part of the deal is subject to the approval of Harvest shareholders as well as the Venezuelan government among others.
The independent has been looking to downsize in order to lighten its debt load and improve liquidity after tumbling into the red last year.