Serica Energy has advised its shareholders that the Executive of the Takeover Panel in London has made a ruling under the Takeover Code that Salamander Energy must by 5pm on November 10, 2008 either announce an offer for Serica or announce that it does not intend to make an offer.
The full text of the Panel's ruling, released on October 16, 2008, is shown below:
"Following recent representations made by the advisers to Serica, the Panel Executive has been considering the application of Rule 2.4(b) of the Code to the approach by Salamander to Serica. Following discussions with all parties' advisers, the Panel Executive has ruled that, unless the Panel Executive consents otherwise, Salamander must, by 5.00 p.m. on November 10, 2008, either announce a firm intention to make an offer for Serica under Rule 2.5 of the Code or announce that it does not intend to make an offer for Serica. In the event that Salamander announces that it does not intend to make an offer for Serica, Salamander and any person acting in concert with it will, except with the consent of the Panel Executive, be bound by the restrictions contained in Rule 2.8 of the Code for six months from the date of such announcement. Each of the parties has accepted this ruling."
This ruling by the Panel follows a highly preliminary, non-binding proposal from Salamander which was, as announced on September 29, 2008, unanimously rejected by the Board of Serica. The Proposal was to acquire Serica on the basis of Serica shareholders receiving one new Salamander share for every three Serica shares currently held. The Board of Serica unanimously concluded that the Proposal failed to reflect both the underlying value and potential which exists in Serica or a premium for control of the Company.
Following the rejection of the Proposal by the Company, Serica's advisers sought this ruling by the Panel in order to remove the uncertainty surrounding the situation and ensure that Salamander makes its intentions clear.
Paul Ellis, Serica CEO, said, "We welcome this ruling from the Takeover Panel and hope that it brings a speedy resolution to this ill-advised approach which grossly undervalues Serica's assets. We urge our shareholders to take no action at this time."
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