BERLIN, Sept. 28 (Xinhua) -- Wintershall and DEA have reached an agreement on a merger which will create Germany's biggest oil and gas producer, Wintershall's parent corporation BASF announced on Thursday night.
BASF said it had signed a binding agreement with DEA owner LetterOne to merge the previously rivalling German oil and gas companies into a single entity.
"With Wintershall DEA, we will create the leading independent European exploration and production company," a statement by BASF deputy chief executive officer (CEO) and chief financial officer (CFO) Hans-Ulrich Engel read.
Wintershall and DEA first announced their fusion at the end of 2017. The two companies hope that the creation of Wintershall DEA will allow them to achieve savings of at least 200 million euros per year from synergy effects.
The transaction is scheduled to be completed by the first half of 2019. Initially, BASF will receive 67 percent of ordinary shares of Wintershall DEA, while Letter One controls a 33 percent stake.
BASF said that the two parties also planned to conduct an initial public offering (IPO) of the new Wintershall DEA company at a still unconfirmed date in the medium-term as the second stage of the fusion.
Wintershall and DEA currently have a combined staff of 3,200 working in oil and gas exploration, production and transportation across Russia, South America, North Africa and the Middle East. The two companies will retain their respective administrative headquarters in Kassel and Hamburg following the merger.