UK asset management fund says ENOC offer too low

Baillie Gifford & Co says offer "understates" the value of Dragon Oil

Exploration & Production, NEWS

Baillie Gifford & Co, an independent asset management firm based in Edinburgh, has released a statement saying the 2nd November 2009 offer made by Emirates National Oil Company Limited (ENOC) LLC for Dragon Oil plc "materially understates" the fundamental and strategic value of the Company.

The statement outlines that over the past decade, Dragon Oil has delivered very strong oil production growth which it believes should be sustained for a number of years to come. "We would encourage management to continue its successful growth strategy and progress its proposed restructuring and application for primary listing on the London Stock Exchange, as announced by the Company on 27th March 2009," it reads.

"This would, we believe, raise the Company’s profile amongst global institutional investors and facilitate enhanced access to capital markets for future growth opportunities."

Richard Sneller, Head of Emerging Markets Equities at Baillie Gifford & Co, said: “We plan to reject the Offer on behalf of our clients, whose holdings under our management currently amount to 4.2% of the issued share capital of the Company, by voting against the scheme of arrangement and matters related to it.”

Baillie Gifford & Co manages approximately GBP53 billion worth of funds for its clients.

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