Norwegian Oil Firm DNO to Acquire Capricorn Energy in $396M Deal
Details and Implications of the DNO-Capricorn Acquisition
Overview of the Acquisition
Sept 1 (Reuters) - Norwegian oil firm DNO has agreed to buy UK's Capricorn Energy for $396 million, the parties said on Tuesday, outbidding rival Genel Energy.
Acquisition Offer Details
• Kurdistan-focused DNO will offer $5.214 in cash for each Capricorn share, higher than Genel's offer of $4.74 per share made in July.
Board Recommendation and Rival Bids
• Capricorn's board on Tuesday said it will recommend DNO's superior offer to its shareholders, withdrawing its support for Genel's $360 million proposal.
Background and Previous Acquisition Attempts
• DNO's interest in Egypt-focused Capricorn comes weeks after its attempt to buy Genel, with which it operates in the Kurdish region of Iraq, was turned down on concerns of undervaluation.
Industry Context and Market Trends
Middle East Oil Sector M&A Activity
• Dealmaking among oil companies operating in the Middle East is gathering pace as a surge in oil prices since the onset of the Iran war in February has enabled some energy firms focused on the region to pursue mergers and acquisitions.
Other Interested Parties
• Capricorn had drawn takeover interest for months, including from Saudi Arabia's privately held Cafani Group and private equity firm Samos before they walked away from the talks.
Reporting Credits
(Reporting by Prerna Bedi in Bengaluru; Editing by Janane Venkatraman)
