Oilexco Falls as North Sea Oil Unit Faces Insolvency

Oilexco Inc., a North Sea producer of oil and gas, lost more than half its market value in London trading today after saying its U.K. subsidiary was likely to file for insolvency administration as early as next week, Bloomberg reported. Calgary-based Oilexco North Sea Ltd. has been informed by Royal Bank of Scotland Group Plc that lenders aren’t prepared to provide further financing, Oilexco said today in a statement. The unit “does not have any other source of funding,” it said, adding that the parent company “remains solvent.” Oilexco hired Morgan Stanley and Merrill Lynch & Co. to help it find alternative funding or a buyer for the whole company or some of its assets, according to the statement. It received interest from BG Group Plc, Petro-Canada and Talisman Energy Inc., the Sunday Times reported Dec. 7, citing people it didn’t identify. Oilexco was up for sale after efforts to raise capital failed, the newspaper said. Read more.