Eni confirms that it agreed on Thursday to buy a 16.11% in Ceska Rafinerska (Cra) from ConocoPhillips, in order to improve its downstream profile in Europe. The deal would nearly double Eni's stake in CRC, bringing it to 32.4%. The deal is still subject to regulatory approval. When asked about the details of the deal Eni CEO Scaroni did not disclose the price but said it was much less than a figure he recently saw in a press report.
Our view: Italian daily newspaper Il Sole reported last week that Eni would pay about EUR 500m (some US$ 675m) for the stake. According to Mr. Scaroni, they paid much less than this. However, it had to be more than Unipetrol's offer of US$ 270m. This indicates to us that the price might have fall in the US$ 300-400m range, what could cut back speculation on Cra's fair value, the major driver of Unipetrol share price in the past few days. Please note that Unipetrol's offer implies US$ 1.65bn fair equity value for Unipetrol, pretty close to our own valuation of US$ 1.67bn.