Goal Petroleum, one of the original band of independent UK companies set up to exploit North Sea oil reserves, has agreed a pounds 131m bid from the Canadian group Talisman Energy. The offer, pitched at 97.5p cash per share, sent Goal's shares up 4.5p to 96.5p yesterday, having already soared from 68p on Tuesday when the company alerted the market that bid talks were under way.
The takeover looked all but sewn up after two of Goal's biggest shareholders - with 45.5 per cent of the shares - gave undertakings to accept the Talisman offer. Norwich Union has pledged its 29 per cent stake to the Talisman offer even if a higher offer emerges. Mercury Asset Management, with around 16 per cent, has also given an irrevocable undertaking, but is still free to accept a rival bid.
Talisman, which until 1992 was a Canadian offshoot of British Petroleum known as BP Canada, is already two or three times the size of Goal in the North Sea. But analysts believe the acquisition will create a North Sea player on a par with substantial existing British groups such as Premier Consolidated Oilfields and Monument Oil & Gas.
Goal brings UK production of around 20,000 barrels of oil equivalent a day - roughly two-thirds the level of Talisman's - and is expected to maintain output over the next two years. Analysts believe that will deliver strong earnings and cash flow, and point to a portfolio of low- risk assets. The majority of its producing fields are operated by British Petroleum and have been in the forefront of its drive to cut costs. It also has extensive exploration acreage.
Duncan Ritchie, Goal managing director, denied that the offer had been accepted because of any hidden problems at the company. "This was a very good offer... a golden opportunity to deliver value to shareholders", he said.
In September, the company announced pre-tax profits lifted from pounds 3.5m to pounds 6.87m for the six months to June. Originally Gas & Oil Acreage Ltd, it was set up by merchant bankers Morgan Grenfell as one of a number of small companies established in the early 1970s to allow direct investment in the North Sea oil bonanza, then in its infancy.
It was one of the original partners in the consortium which discovered the Buchan field in the North Sea and also took a 5 per cent interest in Wytch Farm, the UK's biggest onshore oil field in Dorset. Morgan Grenfell bailed out in the mid-1980s as part of its assets reshuffle at the time of the shake-up in the City associated with Big Bang.Reuse content