Statoil to Acquire Norsk Hydro's Energy Business

Norway's state-controlled oil company, Statoil ASA, announced a plan to buy Norsk Hydro ASA's energy business for about $28 billion. When the dust settles, Statoil will control 70% of Norway's oil production placing in line to compete with other major European oil producers such as BP Plc, Royal Dutch Shell Plc and OAO Gazprom for reserves. The combined entity would have oil and gas production of as much as 1.9 million barrels a day in 2007. Norsk Hydyo shares traded up by as much as 26% in Oslo today.
• Sources: Press Release, Bloomberg, Reuters, Business Week
• Related commentary: Statoil: Norwegian Energy Bargain,Norsk Hydro: Commodity Price Beneficiary, Norsk Hydro: Unlucky or Just Plain Dumb?
• Potentially impacted stocks and ETFs: Statoil ASA (STO), Norsk Hydro (NHY). Competitors: BP Plc (BP), Royal Dutch Shell Plc (RDS.A), Total S.A. (TOT).

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