Venture Production notes the announcement by Centrica of an unsolicited final offer for Venture of 845p per ordinary share. Following a Board meeting, and having consulted its financial advisers, the Board has unanimously concluded the offer is not in the best interests of shareholders and should be rejected by shareholders.
The Board has concluded that Centrica's offer substantially undervalues Venture given its near and long term prospects and the strategic position and high quality of its UK gas reserves and resources:
Leading independent gas producer in the North Sea
Venture is the leading independent gas producer in the North Sea and the ninth largest holder of UK North Sea gas reserves. Venture is forecast to be the tenth largest gas producer in the UK North Sea in 2009 and the only company within the top 10 whose production is forecast to rise over the next three years. In the southern North Sea, Venture has proved and probable gas reserves of approximately 1.1 Tcfe (approximately 180 MMboe) with substantial additional potential resources totaling approximately 2.7 Tcfe (approximately 450 MMboe) on an unrisked basis.
Opportunistic approach by Centrica that undervalues Venture
The Board of Venture believes that Centrica's initial acquisition of shares and subsequent offer are opportunistic.
The Board believes that Venture's high quality gas reserves and resources and strong operational capability are of significant strategic value to Centrica. This strategic value is clearly not reflected in the price that Centrica has offered.
Venture advises shareholders to reject Centrica's offer
Mike Wagstaff, Chief Executive, Venture Production, said, "We are the leading independent gas producer in the North Sea. In no way does this offer recognize the strategic position and high quality of our UK gas reserves and resources for which the markets have clearly and consistently established significantly higher values across a number of recent transactions. Our strong financial position enables us to exploit both our existing strategic portfolio and future acquisition opportunities."
Venture shareholders should note that Centrica's offer is final and will not be increased, except that Centrica reserves the right to revise and/or increase its offer if a competitive situation arises. Should Centrica therefore not satisfy the minimum acceptance condition under its offer, the offer will lapse and Centrica cannot make a further offer for 12 months without the consent of the Takeover Panel.
Most Popular Articles
From the Career Center
Jobs that may interest you