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Board of Directors Meeting |
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| Jul. 21, 99 |
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The Board of Directors of TOTALFINA, chaired by Thierry Desmarest, met on July 21 to review the proposal made on July 18 by the Board of Directors of ELF Aquitaine. Without commenting on the regulatory acceptability of the offer, the Board has made note of the following elements :
1. From an industrial perspective, the ELF Aquitaine project is close to that of TOTALFINA relative to the exploration-production and refining-marketing segments. Regarding the chemical business, TOTALFINA prefers to keep the petrochemicals integrated with refining due to the extensive synergy, as well as to focus on attractive assets with growth outlook in the specialty chemicals portfolio.
2. ELF Aquitaine has put forth a much higher estimate for the synergies. TOTALFINA's analysis of the synergies was made very carefully, taking into account that the absence of discussions between the two management teams called for a certain level of prudence in the matter.
3. From a financial perspective, ELF Aquitaine's projected cash payment of FRF 87 billion would reduce the combined entity's ability to finance major development programs for the large oil and gas reserves of the two companies.
4. ELF Aquitaine's offer to TOTALFINA shareholders is not attractive because it represents a discount to TOTALFINA's share price, based on the share prices preceding TOTALFINA's offer.
TOTALFINA is convinced that its project, driven by a clear, consistent strategy, represents the best option for bringing the two oil Groups together and offers the most attractive opportunity for shareholders of both companies.
Noting the convergence in principle relative to the combination, TOTALFINA is open to discussions intended to give a friendly character to this project, and in particular to set up executive teams that balance the many skills and talents found at both TOTALFINA and ELF Aquitaine.
This press release does not constitute an offer to sell or solicitation of an offer to buy any securities of TOTALFINA. Such an offer will be made in the United States only through a propspectus which is part of an effective registration statement filed with the Securities and Exchange Commission. |
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