UK-based gas producer Energean has officially terminated its $945m deal with private equity giant Carlyle – originally agreed in June 2024 – due to unresolved regulatory approvals in both Italy and Egypt, according to a report by Reuters.
The collapse of the deal highlights the complexities private equity firms face when executing cross-border energy transactions in highly regulated markets.
The agreement was set to establish a new Mediterranean-focused oil and gas company, led by former BP CEO Tony Hayward, leveraging Energean’s assets in Egypt, Italy, and Croatia. However, prolonged regulatory approvals in Italy and Egypt led to missed deadlines, ultimately forcing both parties to walk away.
“While I am disappointed that Carlyle was unable to obtain the necessary approvals in Italy and Egypt, I want to reaffirm that this outcome does not change our strategic direction or our commitment to growth and shareholder returns,” said Energean CEO Mathios Rigas in a statement.
The longstop date for the deal was 20 March, but with no regulatory breakthroughs, the two sides failed to agree on an extension — leading to the deal’s termination.
Despite the deal’s collapse, Energean maintains its growth strategy and reaffirmed that its dividend policy remains unchanged. The company, which operates across eight countries in the Mediterranean and the UK North Sea, recently reported a rise in annual profit after tax but flagged a $241m asset impairment charge tied to operations in Egypt, Morocco, and Greece.
Energean’s leadership made it clear that the company is not actively seeking another buyer for the assets. “We never put our assets up for sale and are not looking for another buyer,” Rigas stated in a post-earnings call.
For Carlyle, the termination marks a setback in its broader energy investment strategy, which has increasingly focused on midstream and upstream assets in emerging markets. The firm, which has a significant energy and natural resources portfolio, may now reevaluate its Mediterranean strategy in light of these regulatory challenges.
