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UPDATE 1-Australia Caltex axes ExxonMobil gas station deal
April 29, 2010 / 9:06 AM / in 7 years

UPDATE 1-Australia Caltex axes ExxonMobil gas station deal

* Caltex, ExxonMobil decide not to proceed with agreed deal

* Says decision due to objection by competition watchdog

* Caltex says to explore growth opportunities

PERTH, April 29 (Reuters) - Caltex Australia Ltd (CTX.AX), the country’s largest refiner, said on Thursday it has scrapped plans to buy ExxonMobil Corp’s (XOM.N) 302 service stations in the country following opposition by the competition watchdog.

Australia’s competition watchdog in December blocked Caltex’s A$300 million ($277.8 million) plan to buy Mobil’s gas service stations, saying the deal would reduce competition across a range of fuel products in Australia.

Caltex said it had discussed with Exxon possible solutions to ease the regulator’s worries, and both parties agreed not to proceed with the “current proposal”.

It is not clear if Caltex has completely abandoned the acquisition plan, or is looking instead to buy fewer Mobil service stations. Caltex could not immediately be reached for comments.

“Caltex will continue to explore opportunities to grow its business,” it said in a statement.

Caltex, 50-percent owned by U.S. energy major Chevron Corp (CVX.N), is growing its fuel marketing business to cut dependence on the volatile refining business, where margins have suffered due to a regional supply glut.

Shares in Caltex, which runs two plants accounting for about a third of Australia’s refining capacity, fell 1.5 percent to A$11.58 on Thursday. The benchmark S&P/ASX 200 index was down 0.8 percent. ($1=1.080 Australian Dollar) (Reporting by Fayen Wong; Editing by Ed Davies and Koh Gui Qing)

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