Norwegian operator DNO has blindsided Genel Energy with a higher, board-recommended offer for Egypt-focused Capricorn Energy just days after shareholders backed the original deal.
Capricorn Energy (LSE: CNE) has ditched its agreed takeover by Genel Energy after DNO tabled a higher recommended offer worth around $396m (£292m), equivalent to $5.214 a share, or 384p in sterling terms.
The new offer, made up of $4.224 in cash plus a special dividend of $0.99 a share, represents a 45% premium to Capricorn's undisturbed share price in March and comes in roughly 10% above Genel's rival bid, prompting Capricorn's board to switch its recommendation.
The move is a striking reversal given Capricorn shareholders had only just voted through Genel's takeover on 18 August. Capricorn's board, advised by Canaccord Genuity, has now thrown its weight behind DNO instead, judging the improved terms too good to ignore.
For DNO, the deal offers a fast route into Egypt, where it wants to build a third core production hub alongside its existing North Sea and Kurdistan operations, drawing on Capricorn's producing Western Desert assets and established in-country team. Executive chairman Bijan Mossavar-Rahmani said the acquisition marked 'an exciting chapter' in the group's 55-year history, adding that DNO planned further investment, licence-round participation and acquisitions to build scale in Egypt.
The battle for Capricorn is entangled with a wider corporate tussle: DNO is separately pursuing Genel Energy itself, having approached its board in July, and faces a 4 September deadline either to make a firm offer or walk away. Securing Capricorn independently could smooth the path towards combining all three businesses, though the outcome of DNO's approach to Genel remains uncertain.
This report is based on Capricorn Energy’s announcement and coverage by UK Investor Magazine. Company announcements can be tracked via London Stock Exchange RNS and Investegate, and the full results calendar is worth watching for the next update.
This article is for general information only and does not constitute investment advice or a recommendation to buy or sell any security. Photo: Strange Happenings on Unsplash.
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