KKR has been in exclusive talks to buy privately held Samson for weeks, two people familiar with the matter said. The involvement of Itochu is a new twist, underscoring the company’s ambition to expand and the surge this year in Japan’s outbound M&A push.
With an enterprise value of more than $7bn, the deal would be the second-largest global private equity transaction of the year, ranking behind Blackstone Group’s $9.4bn agreement to buy nearly 600 shopping malls from Australia’s Centro Properties.
Itochu, which has its roots in linen trading but now deals in everything from energy to insurance, has a 25 per cent stake in the consortium, while KKR holds 60 per cent. Other private equity investors, led by NGP Energy Capital Management with Crestview Partners, will have a 15 per cent stake.
The KKR-Samson deal will exclude Samson’s Gulf of Mexico assets, the sources said. Investment bank Jefferies Group is reportedly advising on the process.
KKR has had recent success with energy investments. Marathon Oil Corp in June struck a deal to buy oil and gas properties in Texas’ Eagle Ford shale field for $3.5bn from KKR and Hilcorp. With the sale, KKR nearly tripled the investment it made just a year ago.