Deal includes $5.2 billion in equity, $2.33 billion in debtIt marks Mitsubishi’s biggest acquisitionMitsubishi aims to strengthen gas value chainAethon Energy likely to buy back up to 25% interestTOKYO, Jan 16 (Reuters) – Japanese trading house Mitsubishi Corp (8058.T), opens new tab will buy the U.S. shale production and infrastructure assets of Aethon Energy Management for $7.53 billion, it said on Friday, its largest deal yet as it seeks to strengthen its gas supply chain.
If finalised, the deal would give the company a substantial natural gas operation adjacent to the U.S. Gulf Coast and the energy export facilities being developed there.
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CEO Katsuya Nakanishi told a press conference the assets included one of the largest reserves in the southern U.S. gas-producing region and offered “high productivity and competitiveness”.
“While capturing the anticipated growth in U.S. domestic gas demand, we aim to ensure a stable energy supply to overseas consumers, including Japan, amid the expected prolongation of the energy transition,” Nakanishi said.
The transaction includes $5.2 billion to acquire Aethon’s equity interests and $2.33 billion of net interest-bearing debt. Aethon will likely repurchase up to a 25% stake in the assets within six months of the deal’s closing expected in the April to June quarter.
JAPANESE INVESTMENT IN US ENERGYThe deal is the latest example of a Japanese company investing in the U.S. energy sector after Tokyo positioned gas as an important transition fuel even beyond 2050 and the country prepares for a surge in power demand from data centres driven by the artificial intelligence boom.
Mitsubishi is a major global LNG player across the value chain, from upstream production to trading, marketing and logistics. It holds stakes in LNG projects in Australia, Canada, Malaysia, Oman, Russia and the U.S., giving it equity LNG output of 15 million metric tons per year.
Aethon, one of the largest privately held U.S. gas producers, focuses on the Haynesville shale formation in Louisiana and East Texas, with upstream output of 2.1 billion cubic feet per day, equivalent to 15 million tons per year of LNG.
Production from the assets is projected to peak at 2.6 Bcf/d in fiscal 2028, while net profit contribution is forecast at 70-80 billion yen ($443-506 million) in fiscal 2027, Mitsubishi said.
The Japanese company plans to use cash, debt financing and other methods to pay for the deal, a company spokesperson said.
In October, JERA, Japan’s biggest power generator, said it would buy U.S. natural gas assets for $1.5 billion, and Japan Petroleum Exploration (1662.T), opens new tab said in December it would acquire Verdad Resources Intermediate Holdings, which owns U.S. tight oil and gas assets, for $1.3 billion.Shares in Mitsubishi extended their decline following the news, settling down 2% against a 0.3% decline in the broader benchmark Nikkei 225 index (.N225), opens new tab.Reuters reported in June that Mitsubishi was in talks to acquire the assets of Aethon Energy Management.
($1 = 158.1400 yen)
Reporting by Yuka Obayashi; Editing by Chang-Ran Kim, Tom Hogue and Barbara Lewis
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