January 11, 2016 / 5:03 PM / in 2 years

UPDATE 2-Dealmaking heats up for oil pricing agencies as IHS buys OPIS

(Adds Argus Media potential sale, PRA regulation)

Jan 11 (Reuters) - Information provider IHS Inc has agreed to buy U.S. oil pricing agency OPIS as deal making in the oil pricing industry heats up after regulators’ scrutiny cools.

IHS, which provides information and analytics to customers from airspace and shipping to government security, will pay $650 million for U.S.-based Oil Price Information Service (OPIS) to add real-time pricing information to its energy analytics business.

Price reporting agencies have come under increased scrutiny since the European Union proposed tougher new rules regulating their activity in 2013. [here ]

The scrutiny peaked when EU officials raided the offices of Platts’, the world’s biggest price reporting agency, and trading offices of BP and Shell and Statoil in 2013.

But last December, the European Commission had dropped its investigation into BP, Shell, Statoil and Platts, part of McGraw Hill Financial Inc <MHFI,N>.

The global securities watchdog IOSCO decided last year that price reporting agencies were adhering to industry guidelines and said further annual reviews were not necessary.

In November 2015, another pricing agency, London-based Argus Media, the second largest of the PRAs after Platts, said it had appointed Bank of America Merrill Lynch to “review strategic options for the next phase of its development.”

Argus said it has been approached by a number of prospective investors including “trade buyers and private equity funds”.

The acquisition of OPIS will become IHS’s second in less than a month. The company agreed in December to buy Canada-based vehicle data provider Carproof Corp for $460 million to boost its automotive research business.

OPIS, a price reporting agency which provides information used for commercial contracts and to settle trades, has presence in 30 countries, IHS said. OPIS is mainly known for its activities in the United States.

OPIS provides real-time and historical spot, wholesale/rack and retail fuel prices for refined products, renewable fuels, and natural gas and gas liquids industries.

The acquisition “gives IHS visibility across the entire petroleum value chain, from wellhead to consumer,” Chief Executive Jerre Stead said on Monday.

IHS abandoned its buyout of software maker Solera Holdings Inc in September.

Thomson Reuters, parent of Reuters news, competes with Platts, Argus and OPIS in providing news and information to the oil markets. (Reporting by Kshitiz Goliya in Bengaluru; additional reporting by Ahmad Ghaddar in London,; editing by Dmitry Zhdannikov and William Hardy)

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