Boston, MA 08/12/2014 (wallstreetpr) – W.P. Carey Inc (NYSE:WPC). recently acquired Total E&P Norge AS’ headquarter (Total Norway) at Stavanger, Norway. The Company purchased Total Norway from the local real estate company Norwegian Property ASA (NPRO) for ~$114 million (NOK716 million) including tax adjustment and transaction costs.
Total Norway is the second transaction for WPC in the Norway. In 2013, the Company acquired Siemens’ Norwegian headquarters (CPA: 18) in Oslo for $776 million.
Rationale
W.P. Carey Inc (NYSE:WPC) intends to enhance the size and diversification and continues focusing on stable real estate income. Total Norway is one of such investment that provides stable option for the Company as it is the wholly owned subsidiary of French oil and gas company Total SA.
The Group, AA/stable rated company, primarily involve in exploration and production of oil and gas in the Norwegian Continental Shelf. The facility also signed a long-term lease contract for 17 years that will allow the WPC a strong stable relationship.
Total Norway, on the other end, represents 10% of the group’s production and reported revenue of $7.5 billion and net income of $1.1 billion in 2013.
Growth prospect
W.P. Carey Inc (NYSE:WPC)’s Director, Arvi Luoma said that the acquisition of Total Norway will give a long-term commitment with the growing industry in the Norway. The petroleum industry expects to be one of the core industries that will support the Norway’s economy in the coming years. Moreover, more than 56% of the country’s oil and gas reserves are available in the Norwegian Continental Shelf.
Even, the rating agencies like Moody’s and Standard & Poor rate Norway as Aaa and AAA respectively. Norway continues to be one of the world’s largest sovereign wealth funds that anticipate ~$1 trillion (NOK 6.3 trillion).
Besides a strong market for the petroleum industry, Norway has favorable locations that support companies in their exploration and production. For instance, Stavanger considers as the oil capital of Europe with increasing oil exploration opportunity in North Sea. The facility locates at a strategic location, which is adjacent to Dusavik port that support the supply North Sea oil fields.
Therefore, W.P. Carey Inc (NYSE:WPC) believes that the partnering with a global major in oil and gas will strengthen WPC’s lease portfolio.
