By Peter OBIORA InvestAdvocate
Lagos (INVESTADVOCATE)- UK oil and gas explorer, Afren Plc said on Friday it has concluded its takeover bid talks with first listed Nigerian oil and gas upstream firm, Seplat Petroleum Development Company Plc.
Afren said it would not agree to a request for an extension of deadline from Seplat to make a firm offer.
“The Board has not received any proposal from Seplat that it believes is capable of being implemented on terms satisfactory to all relevant stakeholders in the company, including the indicated value being significantly below the aggregate value of the debt of the company,” Afren affirmed.
The board of the UK oil and gas explorer said continuing discussions with Seplat is not in the best interests of the company’s stakeholders and will not agree to Seplat’s request for an extension of the deadline.
Afren had on 22 December 2014, announced it had received a highly preliminary approach from Seplat regarding a possible combination with it.
In accordance with Rule 2.6(a) of the UK Takeover Code Seplat was initially given January 30 to make a firm offer. However, it was later postponed on the request of seplat for extension and was later given till February 13, 2015 to either announce a firm intention to make an offer for Afren under Rule 2.7 of the Code or announce that it does not intend to make an offer, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies.
Afren said it remains in talks with creditors for its immediate liquidity and funding needs of the business.
In the same vein, Afren disclosed it’s also having discussions with its existing stakeholders and new third party investors regarding recapitalising the company.
The UK oil and gas explorer is weighed down by the plunge in oil prices and corporate governance concerns. Shares in Afren dropped sharply following the announcement and are traded down 30 percent at 5p a share.
While shares in Seplat at the end of transactions on the Nigerian bourse on Friday gained N16.80 climbing up 4.56 percent.
