Privately owned upstream company Kuwait Energy has hired US firm Perella Weinberg Partners (PWP) to advise it on a potential stake sale that could include all or part of its Block 9 asset in southern Iraq and a disinvestment of Egyptian assets, as per a media report.

The move is aimed at creating much-needed liquidity for the exploration and production-focused company’s shareholders and a cash buffer to repay its debt, Reuters reports.

The move comes after merger talks between Kuwait Energy and London Stock Exchange-listed SOCO International ended unsuccessfully in March, with the parties saying they had not reached “mutually acceptable transaction terms”.

The failure of the merger negotiations with SOCO is understood to be a setback for Kuwait Energy, which had hoped to go public on the London bourse on the second attempt by way of the merger.

The Kuwaiti company, which is headquartered in Bahrain and has assets in Iraq, Oman, Egypt and Yemen, started the merger discussions after failing last year to complete an initial public offer (IPO) of its shares on the London exchange, through which it had hoped to raise about $150m.

This led in December to a board shake-up, which included the resignation of the company’s CEO and co-founder Sara Akbar, and the appointment of six new board directors.

Earlier this year Kuwait Energy sold an 8.57 per cent stake in Block 9 to Dragon Oil, a subsidiary of Dubai’s Emirates National Oil Company (Enoc), for $100m and has settled an ownership dispute with the Dubai entity by giving it an additional 6.43 per cent stake in the block.

The company’s operations in Iraq are focused on three assets, including Block 9, while in Egypt it has interests in four oil and gas fields.

At the end of 2017, Kuwait Energy had a cash balance of $65.6m. The company has an outstanding $250m bond due in 2019, and should start repayments of a convertible loan of around $150m this year to an entity controlled by Dubai-based private equity group Abraaj.