DNO announced on 7 August a possible 69-pence-a-share cash offer for Genel Energy, valuing the London-listed oil producer at about £202m, after Genel's board had rejected the approach.
Why DNO ASA is buying Genel Energy plc
DNO operates the Tawke licence in Iraq's Kurdistan region, in which Genel holds a 25% stake. DNO said it remained willing to engage with Genel's board.
Deal terms and financing
The indicative cash price of 69p a share was a 38% premium to Genel's closing price on 6 August and 30% to its three-month volume-weighted average. Shareholders could choose a mix of cash and new DNO shares. The proposal was non-binding and subject to due diligence. DNO first approached Genel on 28 July.
Regulatory approvals and timing
Under Rule 2.6(a) of the Takeover Code DNO had until 4 September to announce a firm offer or walk away. On 4 September it confirmed it would not make an offer, saying Genel had shown no willingness to engage.
Market context
Genel, which had $240m of cash at 31 July, said the approach fundamentally undervalued it. Genel's shares jumped about 20% on the news and fell 12% when DNO withdrew. Days earlier, Capricorn Energy had recommended a DNO offer about 10% above the price it had agreed with Genel in July.
