Oil Search (ASX:OSH)
has inked a deal for a credit facility which will help boost their liquidity and capital management for the next five years.
The new US$565 million (AU$769 million) credit facility is set to be in force till the 30th of December in 2026, five years away.
This replaces the previous US$600 million (AU$816 million) credit facility that has an expiry date of June next year.
The news follows the proposed merger with Santos (ASX:STO)
and their ongoing talks on the deal. Credit Suisse sees upside risk on when the merger is due post their due diligence. The broker suspects the announcement might be accompanied with details on the merger's upside and synergies which could provide price support for the duo.
Credit Suisse believes a merger is likely but given 75 per cent of votes cast is needed, the broker believes a rejection cannot be ruled out.
Management also advised that they had not explored alternative avenues to the Santos proposal in respect to the company breakup and the outlook on asset sales.
Shares in Oil Search (ASX:OSH)
are trading 2.3 per cent lower at $3.66.