Tullow Oil is set to buy Capricorn Energy (CNE.L) in an all-stock deal valued at US $826.7M. the London-listed energy groups made the announcement and said the move is in accordance with their focus to on the reserve-rich African region.
Investors in Capricorn, formerly known as Cairn Energy, will receive 3.8068 Tullow shares for each share they hold, and will own 47% of the combined group which will be led by Tullow Chief Executive Officer Rahul Dhir. Morgan Stanley and Rothschild & Co were Capricorn’s financial advisers on the deal, while PJT Partners and Barclays advised Tullow.
Embedding sustainability
“The combination represents a unique opportunity to create a leading African energy company, listed in London, with the financial flexibility and human resource capability to access and accelerate near-term organic growth,” the companies said in a statement.
The larger group will have portfolios across countries like Ghana, Egypt, Gabon and Ivory Coast and is expected to be an important supplier of gas in Egypt and in Ghana. They also expect to save US $50M annually within two years of the completion of the deal, which has been unanimously recommended by the boards of both the companies.
Tullow Oil plc is a multinational oil and gas exploration company founded in Tullow, Ireland with its headquarters in London, United Kingdom. The company is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index. The Group has interests in over 30 exploration and production licences across eight countries.
Tullow takes a strategic approach to embedding sustainability throughout their business. This approach is based on understanding of the needs and demands of stakeholders, combined with a focus on the topics that reflect most significant economic, social and environmental impacts.
