Talisman Mining Ord Shs TLM

Repsol cash limits

[shambano1]

Possible Repsol Deal Logical Though Likely Has Limits -- Market Talk

Published: Jul 23, 2014

[Dow Jones] -- It's no secret Repsol (REP.MC) has been looking around for acquisitions, particularly of oil assets in OECD countries, so confirmation from Canada's Talisman Energy that the two companies have been in talks about a transaction is not a surprise, says one London-based analyst. Repsol has lots of cash, particularly after it received $5 billion in compensation from the Argentine government this year. Still, it shouldn't be assumed that Repsol will buy the whole of Talisman which could cost its $12B-$13B, and which has assets in North America but also in Asia and Kazakhstan; Repsol might be prepared to spend $4B-$5B of its cash pile, but spending more could mean the oil company has to sell down some or all of its 30% stake in Gas Natural if it doesn't want to harm its credit rating. ([e-mail])