Source: Premier Spurns Ophir Bid to Forge $5B Oil Group

Reuters

LONDON, April 27 (Reuters) – Premier Oil has rejected two secret bid approaches from Ophir Energy, which wants to forge a 3 billion pounds ($5 billion) combined oil exploration group, a person with knowledge of the matter said on Sunday.

The latest all-share merger proposal was unanimously turned down by Premier's board a fortnight ago because it was not considered to offer a good strategic fit, according to the source, who asked not to be named because the matter is not public.

Premier and Ophir declined to comment.

Combining Premier and Ophir would create a firm operating from east Africa to Asia to the Falklands. It would be the fifth largest oil and gas explorer listed in London, behind BP, Shell, BG and Tullow Oil.

The Sunday Times, which first reported the takeover approaches, said the companies were likely to make a statement to the stock market on Monday now that the discussions had been publicised.

Ophir, led by former Goldman Sachs banker Nick Cooper, made its first bid approach in February, days after Premier announced that its chief executive Simon Lockett would be stepping down after nine years in the role.

Shares in Premier jumped on news of the departure of Lockett, whom shareholders have held responsible for successive downgrades to production guidance in 2013 and disappointing forecasts for this year.

Premier, which has a market capitalisation of 1.72 billion pounds, was founded in Scotland in 1934 as the Caribbean Oil Company to look for oil and gas in Trinidad.

Ophir, worth 1.44 billion pounds, floated on the London stock market only three years ago and saw its shares jump in 2012 following a significant gas find in Tanzania. ($1 = 0.5948 British Pounds)

(Writing by Ben Hirschler; Editing by Sophie Walker)

Copyright 2017 Thomson Reuters. Click for Restrictions.

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