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Korea National Won't Raise $2.6 Billion Takeover Bid for Dana Petroleum
Korea National Oil Corp., the state- owned energy company engaged in a $2.6 billion hostile takeover battle for Dana Petroleum Plc, said its offer is final.
A defense document released by Dana’s board yesterday doesn’t contain any information that alters its view of the company’s value, Korea National, also known as KNOC, said in a statement today. Its 1,800 pence-a-share offer represents a 59 percent premium to the U.K. explorer’s pre-bid share price.
KNOC’s offer “provides compelling value in cash for Dana shareholders and incorporates full and fair value for Dana’s entire portfolio of production, development and exploration assets,” it said.
Dana fell 24 pence, or 1.3 percent, to 1,785 pence in London trading. The shares had previously been trading above KNOC’s offer price in anticipation of a higher bid.
The Korean company said it will only increase the offer if a competitive situation arises, such as another bidder emerges. Dana’s Chief Executive Officer Tom Cross declined to say yesterday whether a so-called white knight has materialized.
Dana, based in Aberdeen, Scotland, said yesterday that KNOC’s offer would “utterly fail” to compensate its shareholders. Its board rejected the bid, saying Dana is worth at least 18 percent more than KNOC’s offer.
The explorer agreed to pay about 240 million pounds ($370 million) to Suncor Energy Inc.’s Petro-Canada UK Ltd. for production hubs in the U.K. North Sea.
In response, KNOC said Dana’s organic production growth had fallen by 4.6 percent in the first half, while its reserves were been subject to a negative revision.
Dana shareholders have until Sept 23 to accept KNOC’s offer.
To contact the reporter on this story: Kari Lundgren in London at klundgren2@bloomberg.net
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