DNO Makes Offer for Gulf Keystone Petroleum

Norwegian oil and gas operator DNO ASA has unveiled a proposal to acquire all of the enlarged share capital in Gulf Keystone Petroleum for $300 million.

The terms of the DNO proposal, which would comprise cash and shares, reflect a 20 percent premium to the share price of $0.0109 at which, on July 14, Gulf Keystone issued shares representing 5.6 percent of its share capital. The offer also reflects a 20 percent premium to the price at which Gulf Keystone intends to issue further shares in its restructuring.

DNO’s terms include an offer of $120 million in cash, which is approximately 40 percent of the consideration, and an additional offer of 170 million DNO shares, which is approximately 13.6 percent of the post transaction DNO share capital.

"Combining these two companies will create further scale and unlock operational synergies that will reinforce DNO's already formidable presence in Kurdistan," said Bijan Mossavar-Rahmani, DNO's executive chairman, in a company statement.

"We understand Shaikan's challenges and opportunities and we are well positioned to focus financial, technical, commercial and logistical support to maintain and then grow production at this field to the benefit of both Kurdistan and our investors," he added.

Gulf Keystone, a Bermuda incorporated and London listed company, has called a special general meeting for August 5 to consider its contemplated financial restructuring. DNO has written to the board of directors of Gulf Keystone to present its proposal and to facilitate immediate engagement with Gulf Keystone's investors ahead of the meeting to ensure sufficient time for these investors to carefully consider the enhanced terms proposed by DNO.



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