Sector News

Salamander Energy Gets Potential Offer From Ophir Energy, CEPSA

October 27, 2014
(RTTNews) – Shares of Salamander Energy Plc (SMDR.L) climbed around 22 percent in the morning trading in London after the firm Monday confirmed that it has received a conditional proposal for a potential offer from Ophir Energy Plc (OPHR.L). Responding to recent press speculation, Salamander Energy said it is seeking to clarify the terms of the offer.
In addition, Salamander Energy received an approach from a consortium led by Compañía Española de Petróleos or CEPSA and Jynwel Capital. The Board of Salamander has not received the detail of the CEPSA Consortium’s proposal or confirmation that any offer will be forthcoming. Salamander Energy said the proposals from Ophir and the CEPSA Consortium are subject to a number of conditions, including due diligence and the receipt of a unanimous recommendation from its Board.
The company added that it is currently in discussions with both Ophir and the CEPSA Consortium in relation to their respective proposals.
However, shareholders are advised to take no action at this time as there can be no certainty that any offer will be forthcoming, or as to the terms of any such offer.
Each of Ophir and the CEPSA Consortium is required, by no later than November 24, to either announce a firm intention to make an offer for Salamander, or announce that it does not intend to make an offer.
Salamander further said that contrary to remarks in the press, its deal with Sona Petroleum Berhard for its 40 percent working interest in the B8/38 concession remains on track for completion before the end of 2014, in keeping with the timetable and strategy previously outlined.
It was in July that the company signed the deal to sell interest in the B8/38 concession (containing the Bualuang oil field) and the surrounding G4/50 concession, both located in the Gulf of Thailand.
Subject to the outcome of the ongoing latest offer discussions, the board continues to believe that completion of the SONA Transaction is in the best interests of shareholders. According to the firm, the $280 million of proceeds from the SONA deal would strengthen its balance sheet.
Separately, Ophir Energy announced it has entered into an agreement with Niko Resources to acquire interests in seven deepwater Production Sharing Contracts in Indonesia. The acquisition of interests in seven PSCs, six of which will be operated by Ophir, is for a cash consideration of $31.3million with further payments contingent on exploration success. In aggregate, the total further consideration payable on success is capped at $56 million.
Post completion, Ophir expects the transaction to increase its total gross licensed acreage by 40 percent. The transaction is subject to approval by SKKMiGas and the Government of Indonesia. In London, Salamander Energy shares were gaining 21.81 percent, and trading at 97.75 pence, while Ophir Energy is losing 3.26 percent, and trading at 196.10 pence.

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