By Sarah Sloat
FRANKFURT--German chemical company BASF SE and Russia's Gazprom
have called off an asset swap deal that was set to be completed
this year because of the difficult political environment, BASF said
Thursday.
The collapse of the natural-gas storage and trading deal means
BASF now expects earnings for interest and taxes to be slightly
rather than considerably higher this year, as it won't collect
income from divestitures related to the transaction. BASF will also
book expenses of EUR113 million for 2013 and EUR211 million for
2014, it said.
"Due to current political difficulties we have agreed with
Gazprom not to complete the transaction," a spokeswoman said.
The natural-gas trading business will continue to operate as a
50-50 joint venture between state-owned Gazprom and BASF's
Wintershall unit, BASF said.
In the swap, Wintershall would have transferred the jointly
operated natural- gas trading and storage business to Gazprom.
Gazprom would have received a 50% share in the activities of
Wintershall Noordzee, which is active in the exploration and
production of oil and gas. These activities together contributed
around EUR12 billion to sales and about EUR500 million to earnings
before interest, taxes, depreciation and amortization at BASF in
2013.
In return, Gazprom and Wintershall planned to jointly develop
two additional blocks of a natural-gas field in Siberia.
Write to Sarah Sloat at sarah.sloat@wsj.com
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