Path clear for Genel to buy Capricorn as DNO refuses to raise offer

DNO ASA on Monday announced it will not raise its offer to buy Capricorn Energy PLC, ending a takeover battle ultimately won by Genel Energy PLC.

The Oslo-based oil and gas operator said it "retains a highly disciplined approach to mergers & acquisitions" and accordingly will not raise its revised offer for Capricorn, which will remain below Genel's offer.

DNO said it continues to gauge a pipeline of opportunities across the North Sea and the Kurdistan region of Iraq.

Capricorn is an Edinburgh-based oil and gas company with operations in Egypt. Genel is a smaller peer with production assets in the Kurdistan region of Iraq and exploration assets in Oman and Somaliland.

Genel on Friday had offered USD4.75 in cash plus a special dividend of 99 US cents, valuing Capricorn Energy at USD5.74 per share in total, or USD436 million.

Capricorn Energy were down 4.7% to 429.00 pence each on Monday morning in London, around USD5.69, for a market capitalisation of £306.3 million. Genel Energy shares were 1.8% higher at 63.00p each, giving it a market cap of £175.5 million.

Capricorn earlier in September had announced its support for a rival takeover offer from DNO at a value of around USD5.21 per share, or USD396 million. On Friday it announced the immediate withdrawal of its support for the DNO offer, following Genel's higher bid.

Genel has irrevocable undertakings for around 39% of Capricorn's shares. The only outstanding regulatory approval is from Egypt, which Capricorn expects to be satisfied in accordance with the expected timetable.

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