UK oil explorer, Dana Petroleum, is facing a hostile take over from the South Korean state oil company, KNOC, after Dana’s board rejected their offer of last week. The rejection angered many shareholders that thought the offer was fair. KNOC says it has the support of shareholders and has begun the 1.87 billion pound takeover.
The takeover will be worth 18 pounds per share in cash for shareholders. The value of the bid represents a premium of nearly 60 per cent to Dana’s shares price of June 30.
When KNOC wanted access to Dana’s books earlier this month talks between the two companies broke down. After raising its offer to 17 pounds per share, KNOC refused to give more as requested by Dana.
KNOC was given 4.2 billion pounds in government funds to increase the country’s oil reserves. Dana Petroleum has reserves of 223 million barrels of oil from 36 oil and gas fields in the North Sea, Morocco, and Egypt.
Seong-Hoon Kim, senior executive vice president of KNOC, said: “It has always been our desire to agree a recommended transaction with the board of Dana and we are very disappointed that the board of Dana does not agree that £18 per share represents a full and fair value for the company.
“We believe that we have no alternative other than to put our attractive proposal directly to shareholders given the inability to reach a private agreement with the board of Dana.
“We hope that Dana shareholders will recognise the merits of our offer in order to bring this process to a successful conclusion.”