Clyde makes late plea for loyalty
Saturday 08 February 1997
Despite a point-by-point rebuttal of many of Gulf's claims, however, its share price remained resolutely stuck at the new offer price and analysts continue to believe the Canadians may have done just enough to tip the balance in their favour.
After 50 days of acrimonious tit-for-tat between the two companies, Gulf finally increased its original 105p offer last week, increasing the value of its bid from pounds 432m to just under pounds 500m. Clyde's fate is expected to be decided by a handful of large institutional shareholders, four of which own half the oil producer's shares. Although some have previously said they would be unwilling to accept less than 135p, it is now felt that, in the absence of a higher offer from a white knight, 120p may just win the day.
Roy Franklin, managing director of Clyde, said: "Clyde has delivered, is delivering and will continue to deliver. Our strategy is working, as borne out by our 1996 results. What we have achieved is only a foretaste of what we aim to achieve in the future. I firmly believe our shareholders are better off rejecting this offer."
Having been forced under Takeover Panel rules to hold its fire after day 39 of the bid to give Gulf a week to marshal its final arguments, Clyde returned to the offensive in the letter, accusing Gulf of "seeking Clyde's valuable cash flow to help support its substantial debt burden".
According to Clyde, Gulf has net debts of about pounds 1.1bn, even after two equity issues in the past 12 months. "This huge pro forma net debt would represent some 3.5 times Gulf Canada's estimated pro forma 1997 discretionary cash flow. With these financial constraints on Gulf Canada, Clyde's shareholders should not be surprised that Gulf Canada is not prepared to offer full value for Clyde shares."
Gulf Canada dismissed Clyde's latest contribution to the bitter debate between the two: "Clyde's latest document smacks of desperation.
"Its comments about Gulf Canada's balance sheet are irrelevant for a cash bid and ill-conceived."
In its final offer Gulf made much of the assumptions employed by ERC, the oil consultant commissioned by Clyde to evaluate its asset value.
Clyde defended them yesterday as conservative and pointed out that some were the same as those used by SSI, a consultant working for Gulf in this bid, in a previous bid situation when it was working with Morgan Grenfell, the merchant bank acting for Gulf in this bid.
- 1 I was raped by another man. And now the Government wants to take away the one thing that saved my life
- 2 Wikipedia edits from inside Parliament removing scandals from MPs' pages, investigation finds
- 3 Preston fan who appeared to snatch Jermaine Beckford's shirt from eight-year-old boy identified and says: 'the truth will come out'
- 4 Johnny Depp facing 10 years in jail for illegally bringing dogs to Australia
- 5 Iran launches anti-Isis cartoon competition 'to expose true nature of Islamic State'
Wikipedia edits from inside Parliament removing scandals from MPs' pages, investigation finds
Australian man punched in the face for defending Muslim women from abuse on train
Priest warns pupils the 'Charlie Charlie Challenge' is 'demonic activity'
Johnny Depp facing 10 years in jail for illegally bringing dogs to Australia
Iran launches anti-Isis cartoon competition 'to expose true nature of Islamic State'
As a white man, I'm surprised more women aren't tweeting the hashtag #KillAllWhiteMen
EU referendum: David Cameron's rules are a 'democratic disgrace', says French-born Scottish politician set to be denied a vote
The day that Britain resigned as a global power
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
A nation of inequality: How the UK is failing to feed its most vulnerable people
EU referendum: David Cameron to deny EU migrants and under-18s the chance to vote
iJobs Money & Business
£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is a mul...
£55 - 65k (DOE): Guru Careers: A unique opportunity for a permanent C# Develop...
£16 - 20k: Guru Careers: A Graduate Editor / Editorial Assistant is needed to ...
£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...