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ENOC presses ahead with Dragon Oil acquisition

Shareholders have until July 30 to agree to the terms of the proposed deal

ENOC CEO Saif Humaid Al Falasi.
ENOC CEO Saif Humaid Al Falasi.

Emirates National Oil Company (ENOC) is pressing ahead with plans to take over Dragon Oil despite recent protest from a major investor who claimed the offer undervalued the company, Reuters reports.

Accoridng to a document published on Wednesday by the company, the deal is moving ahead and shareholders have until 1400 GMT on July 30 to agree to the terms of the proposed deal.

ENOC made an offer for Dragon Oil's shares it already does not own for $2.7bn. ENOC, which already owns almost 54% of Dragon Oil, tried to acquire the minority shares of the Dublin-based outfit in 2009 but its bid got rejected.

This time around, it raised its bid from 735p a share to 750p a share which got shareholders to agree to the deal. 

But two weeks ago Dragon Oil's second-largest shareholder said the offer did not fully value the future growth potential of the firm. Baillie Gifford said the takeover offer "materially undervalued" the company.

Fund manager Baillie Gifford, which owns 7.2% of the company, said the offer did not fully value the future growth potential of the firm.

“We encourage shareholders to consider the case presented here, and reflect on the growth infrastructure that is presently being assembled before making their own determination whether or not to accept the current Offer,” Reuters quoted Richard Sneller, head of emerging markets at the fund manager, as saying.

"We see no need to offer a contingent payment note or any similar cumbersome mechanism given the plateau in Dragon Oil's production," an ENOC spokesman said in a statement.

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