Tuesday 12 January 2021 3:09 pm

Premier Oil shareholders back Chrysaor merger as era comes to an end

Premier Oil’s shareholders have today voted overwhelmingly in favour of the North Sea-focused firm’s merger with fellow independent Chrysaor.

At this afternoon’s general meeting, 98.7 per cent of shareholders backed the motion, which marks the end of an era for the veteran firm.

Read more: Premier Oil production to fall as Chrysaor merger nears

The deal is expected to be completed by the end of the first quarter.

Premier is one of the oldest independent oil explorers, having been founded in 1934.

After acquiring its first interest in the North Sea in 1971, it quickly expanded its presence in the continental basin.

However, following 2014’s oil price crash, the firm took on a considerable amount of debt, which has subsequently weighed on Premier’s balance sheet.

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The deal, which was agreed in October, will make the combined Chrysaor-Premier entity the largest independent listed oil player.

The combined firm will be renamed Harbour Energy, with Premier stakeholders to own no more than 23 per cent of the total stock.

Analysts at Jefferies said that the deal would create an estimated $200m in equity value for Premier shareholders.

Read more: Premier Oil strikes deal to merge with North Sea rival Chrysaor

The new entity will be led by Chrysaor chair Linda Cook, who used to run Shell’s gas and power division.

As a result of the merger the group will have a combined production of over 250,000 barrels of oil per day.