Lasmo paid pounds 24m to fight off Enterprise

SCHRODERS and Goldman Sachs were paid pounds 6m each, and NatWest pounds 4m, for helping Lasmo fight off the pounds 1.6bn takeover bid from Enterprise earlier this year.

The total fee paid by Lasmo was pounds 24m, which included about pounds 3.5m on lawyers' and accountants' fees, as well as about pounds 800,000 to Brunswick, its public relations firm.

Last week, Enterprise disclosed that it had paid pounds 5.7m to its advisers, of which about pounds 2m was paid to Warburg and pounds 1m each to Robert Fleming and Lehman Brothers, according to estimates by Acquisitions Monthly. The lower total cost reflects the fact that most of its advisers would have been on success-related fees.

Joe Darby, Lasmo chief executive, said that the fees worked out at 1.6 per cent of the bid value, only slightly above the 1.43 per cent average cost of recent defences against hostile bids. He added that he had negotiated charges down by more than 5 per cent.

The bid costs were offset by a pounds 36m profit from the sale of businesses, but the group still made a pounds 22m loss, after tax and preference dividends, in the six months to June, compared with a pounds 22m profit last time. Rudolph Agnew, chairman, said the results had been affected by the low oil price and would 'continue to be under pressure at current oil price levels'.

Mr Darby added that the group remained on course to reduce its costs by 25 per cent, compared with 1993 levels, by 1997. That would be partly because lower-cost fields, such as Kadanwari in Pakistan and Birch in the North Sea, would start producing.

The results were welcomed in the City as evidence that Lasmo is keeping promises made during the bid battle. Colin Smith, oil analyst with Hoare Govett, believes it could start to make profits next year.

----------------------------------------------------------------- LASMO'S DEFENCE: WHERE THE MONEY WENT ----------------------------------------------------------------- Schroders pounds 6m Goldman Sachs pounds 6m NatWest Markets pounds 4m Slaughter & May and Sullivan & Cromwell pounds 2m Ernst & Young and Coopers & Lybrand pounds 1.5m Brunswick pounds 800,000 De Golyer and MacNaughton, other consulting costs pounds 3.7m -----------------------------------------------------------------

View From City Road, page 19

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