Warning that it had never before increased an offer in a bid situation, Gulf unsettled the market in Clyde shares which from the outset of the hostile takeover attempt have traded above the value of the 105p, pounds 432m offer.
Clyde's shares closed yesterday 2.5p lower at 120.5p after Gulf's chief executive, JP Bryan, said the defence "represented a desperate attempt to obscure reality with irrelevant facts and spurious valuation methodologies".
At that level, the shares are still ahead of the cash offer price, but well below the 160p fair value the target's latest defence circular suggested for its shares.
Roy Franklin, chief executive of Clyde, responded in kind. "This is predictable rhetoric. Gulf's imaginative use of numbers and timings is a complete irrelevance. Nothing in this document undermines our case. The success of our strategy is self-evident."
Gulf's latest attack focused on the long-term track record of Clyde. During the six years prior to its offer, Gulf said, Clyde's market value had diminished by pounds 149m, its share price had fallen by 45 per cent in the same period and it had failed to pay a dividend in four out of the past 10 years.
Clyde responded that it had been a recovery play since 1993 and questioned the validity of drawing attention to its performance before that time, which coincided with the appointment of Roy Franklin as chief executive.
Gulf also ridiculed Clyde's attempt to focus on a multiple of cash flow as the most appropriate valuation method for an oil company rather than net asset value.
Clyde has until next Tuesday to complete its defence and Gulf another week to finalise its offer.Reuse content