Dragon Oil shareholders reject ENOC’s $1.9 billion buy-out bid
14 Dec 2009
Turkmenistan-focused oil and gas company Dragon Oil Plc said that its shareholders voted against a complete takeover bid by its majority shareholder, Dubai's state-owned Emirates National Oil Company LLC (ENOC), apparently a fall-out of the recent Dubai crisis.
ENOC, which owns a 51.5-per cent stake in Dragon Oil, submitted an offer in November to gain full control of the latter, by acquiring the 48.5 per cent shares that it currently doesn't own, for approximately $1.9 billion. (See: Dubai's ENOC to acquire Dragon Oil for $1.9 billion)
The offer price of 455 pence represented a premium of nearly 35 per cent to the closing price of Dragon Oil shares before ENOC indicated its interest. Through the acquisition, ENOC aimed to expand its upstream activities into oil rich Turkmenistan.
The independent committee of Dragon Oil announced that at the meeting of the company's shareholders other than ENOC, the acquisition resolution was not passed by the requisite majority.
The bid was favoured by 75.6 per cent of shareholders or their proxies by number, but only 48.9 per cent by value, while the requirement as per the law was 75 per cent by value.
Dubai-based Dragon Oil's principal assets located in the Cheleken contract area, offshore Turkmenistan, in the Caspian Sea and operated by its subsidiary Dragon Oil (Turkmenistan) Limited. Its shares are listed on the stock exchanges of London and Dublin.
