Gulf increases offer for Clyde to 120p a share

The finely balanced bid battle between Gulf Canada and Clyde Petroleum entered the finishing straight yesterday after Gulf launched a final offer of 120p a share for its smaller British target and moved into the market to buy shares. The new bid, which replaces Gulf's 105p offer, puts a value of just under pounds 500m on Clyde.

Gulf said it was confident it had pitched its new bid at just the right level to secure control and said it was surprised at how many Clyde shareholders had accepted its cash offer in early dealings yesterday morning, given rumours in the market that a third-party bid might emerge at the eleventh hour. By the close of play yesterday afternoon it had mopped up 15 million shares, or just under 3 per cent of Clyde's equity.

JP Bryan, chief executive, said he thought a rival bid from a "white knight" was unlikely. Gulf cannot now increase its offer unless another bid is announced before 18 February, the end of the official 60-day offer timetable.

Malcolm Gourlay, chairman of Clyde, responded: "Clyde's value is not speculative - it is real, it is substantial and it belongs to our shareholders. Gulf Canada is a highly leveraged vehicle that can't afford to pay full value for Clyde. Clyde is worth a great deal more than this offer."

Institutional shareholders, who had previously expressed unwillingness to accept an offer pitched at less than about 135p, were yesterday considering their options, although the main players who will decide Clyde's fate are unlikely to make a final decision for 10 days or so. More than half Clyde's shares are held by Schroders, PDFM, Capital Group of the US and Norwich Union. About two-thirds of the equity is in the hands of seven fund managers.

Analysts thought Gulf might have done just enough to clinch victory yesterday after a strong offer document attempted to dismantle the main planks of Clyde's recent defence. In the market, Clyde's shares moved 2.5p higher to 120p as dealers weighed up the possibility of a white knight with a potential fall in the shares if the bid failed to persuade shareholders.

Gulf said its new offer represented 100 per cent of a net asset value figure signed off by ERC, an oil industry consultant commissioned by Clyde to assess its value. By contrast, Gulf said, contested offers for oil exploration and production companies over the past 12 years had gained shareholder support at an average 75 per cent of such commissioned valuations.

Gulf criticised ERC's base asset value of 120p, saying it relied on unrealistic discount and inflation rates and over-optimistic exchange rate assumptions and oil price forecasts.

Comment, page 19

Start your day with The Independent, sign up for daily news emails
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Digital Optimisation Executive - Marketing

£30000 - £35000 per annum: Recruitment Genius: The UK's fastest growing, multi...

Recruitment Genius: Financial Reporting Manager

£70000 - £90000 per annum: Recruitment Genius: A Financial Reporting Manager i...

Recruitment Genius: Payments Operations Assistant

£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

Recruitment Genius: Telephone Debt Negotiator

£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

Day In a Page

Sepp Blatter resignation: The beginning of Fifa's long road to reform?

Does Blatter's departure mean Fifa will automatically clean up its act?

Don't bet on it, says Tom Peck
Charles Kennedy: The baby of the House who grew into a Lib Dem giant

The baby of the House who grew into a Lib Dem giant

Charles Kennedy was consistently a man of the centre-left, dedicated to social justice, but was also a champion of liberty and an opponent of the nanny-state, says Baroness Williams
Syria civil war: The harrowing testament of a five-year-old victim of this endless conflict

The harrowing testament of a five-year-old victim of Syria's endless civil war

Sahar Qanbar lost her mother and brother as civilians and government soldiers fought side by side after being surrounded by brutal Islamist fighters. Robert Fisk visited her
The future of songwriting: How streaming is changing everything we know about making music

The future of songwriting

How streaming is changing everything we know about making music
William Shemin and Henry Johnson: Jewish and black soldiers receive World War I Medal of Honor amid claims of discrimination

Recognition at long last

Jewish and black soldiers who fought in WWI finally receive medals after claims of discrimination
Beating obesity: The new pacemaker which helps over-eaters

Beating obesity

The new pacemaker which helps over-eaters
9 best women's festival waterproofs

Ready for rain: 9 best women's festival waterproofs

These are the macs to keep your denim dry and your hair frizz-free(ish)
Cycling World Hour Record: Nervous Sir Bradley Wiggins ready for pain as he prepares to go distance

Wiggins worried

Nervous Sir Bradley ready for pain as he prepares to attempt cycling's World Hour Record
Liverpool close in on Milner signing

Liverpool close in on Milner signing

Reds baulk at Christian Benteke £32.5m release clause
On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

On your feet!

Spending half the day standing 'reduces risk of heart attacks and cancer'
With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

The big NHS question

Why are there so few new GPs when so many want to study medicine?
Big knickers are back: Thongs ain't what they used to be

Thongs ain't what they used to be

Big knickers are back
Thurston Moore interview

Thurston Moore interview

On living in London, Sonic Youth and musical memoirs
In full bloom

In full bloom

Floral print womenswear
From leading man to Elephant Man, Bradley Cooper is terrific

From leading man to Elephant Man

Bradley Cooper is terrific