PTTEP Extends Acceptance Date for $1.9B Cove Bid
by Jon Mainwaring
|Monday, June 25, 2012
PTT Exploration & Production (PTTEP) and Royal Dutch Shell are continuing to play of game of seeing who blinks first in their takeover battle for East Africa-focused Cove Energy, with the Thai company announcing Monday that its $1.9 billion bid is being extended to July 6.
In mid-June, Shell announced it was extending its $1.8 billion offer for Cove to June 27 but did not increase the price it was willing to pay for the firm.
Recently, investors have been speculating that Shell might increase its offer before Wednesday, so PTTEP's latest move could be seen as a preemptive attempt to show investors – and Shell – that it is prepared to stick around.
Cove's board of directors originally recommended that investors accept Shell's $1.8 billion offer, but changed its mind in late May after PTT upped its own bid.
Cove – whose shares are quoted on London's Alternative Investment Market – holds an 8.5-percent stake in the Rovuma offshore basin. The area is being explored – with plenty of success so far – by operator Anadarko for significant natural gas resources that both Shell and PTT believe would be suitable for LNG projects. The acquisition of Cove would give either of these two oil giants an important foothold in the region.
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