Clyde holds out for higher price

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The Independent Online
Clyde Petroleum will next week reveal sharply improved 1996 profits and more details about the company's higher level of proven and probable oil reserves in the hope of pushing Gulf Canada to raise its 105p-a-share bid for the company.

Full year profits are expected to exceed forecasts of pounds 27m, and the company is understood to be preparing aggressive cashflow projections for its defence document, which it can send to investors before 28 January, or day 39 of the bid, according to Takeover Panel rules.

Mr Roy Franklin, managing director of Clyde, confirmed that the company would be issuing its 1996 results in a defence document "within a few days", and hinted that the directors would look favourably on a 125p bid, whether it came from Gulf or a third party.

Advisers to Gulf Canada remained dismissive, saying that they did not expect Clyde to produce anything of any substance in their next defence document that would change Gulf's current position on Clyde's value. "But clearly, if Clyde revealed something that made our eyes pop then we would reconsider our position," said one adviser to Gulf.

Analysts were divided on the value of Clyde's exploration and production assets, with some backing Clyde's view that the company should be valued on a multiple of its cashflow, while others tended towards the traditional net asset value method, which values Clyde at between 70p and 80p a share.

Meanwhile, the market remains expectant of a counter-bid or a revised offer from Gulf. The shares closed at 117p on Friday - 12p above the Gulf offer price.