Indonesia’s Medco Energi could offer $436m for Britain’s Ophir

Medco Energi
Photo: Medco Energi website

Indonesia’s Medco Energi International Tbk PT said on Friday a possible all-cash takeover offer by its unit for Ophir Energy would value the British firm at 340 million pounds ($435.88 million).

Medco said shareholders of Ophir, an upstream oil and gas exploration and production company focused on Asia and Africa, would receive 48.5 pence in cash for each Ophir share.

Under British takeover rules, Medco’s fully-owned subsidiary PT Medco Energi Global has until Jan. 28 to make a firm offer or walk away.

Analysts have said a deal with Ophir would boost Medco’s valuations and help it gain access to international assets.

The price represents a 46.1 percent premium to Ophir’s share close of 33.2 pence on Dec. 28, the last business day before Medco Global announced the possible offer for Ophir.

Ophir did not immediately respond to a request for comment.

Ophir, whose shares fell 47 percent in 2018, has said it expects to report a non-cash write down of $300 million on a liquefied natural gas project in Africa and that it would shift its headquarters from London to Asia, where it bought assets in 2018.

Founded by oil and gas tycoon Arifin Panigoro, Medco has made sizeable acquisitions in recent years, including leading a $2.6 billion purchase of the Indonesian unit of Newmont Mining Corp in November 2016. It also operates power plants in Indonesia.

Medco, headquartered in Jakarta, earns the bulk of its revenue from oil and gas operations, mainly in Indonesia. The firm has focussed on expanding its Southeast Asia presence and adding to its existing assets in the Middle East and North Africa.

Standard Chartered Bank is acting as financial adviser to Medco.

Shares in Ophir, which has a market value of 305 million pounds, were 3.4 percent higher at 44.5 pence at 1138 GMT.

Reuters