Koreans close in on Dana takeover with dawn raid

Knoc buys 29.5 per cent of Scottish oil company at £18 a share

Korea National Oil Corporation was last night in touching distance of pulling off its £1.7bn hostile bid for Dana Petroleum, after a dawn raid that saw it snap up almost 30 per cent of the Scottish oil company's shares.

While Knoc needs 90 per cent of Dana's shareholders to sell up for the deal to be finalised, the Koran state-backed company is now understood to be extremely confident of securing the prize at the end of what has been a bitter takeover battle.

Knoc, to which the Korean government has extended considerable funding as it seeks to reduce its dependence on imports of oil and gas, first approached Dana in June. After the Scottish company rejected its £18-a-share bid, Knoc went straight to shareholders, who have until next Thursday to decide whether to accept the offer.

Knoc has repeatedly refused to raise its bid, dismissing Dana's accusation that the offer was "opportunistic and inadequate". It also poured scorn on an independent report commissioned by Tom Cross, Dana's chief executive, which suggested a fair value for the company would be between £21.20 and £24.65 a share.

Dana's claim to be in a "transformational growth period" did not stack up, Knoc argued, because production from the Scottish company's existing assets had been falling, and estimates of its reserves had been revised down.

Nevertheless, Dana has continued to urge shareholders to reject Knoc's advances, clinging to the hope that a rival bidder might emerge, or even that it might be able to secure a higher price by agreeing to recommend the bid. Though its defence was knocked by the decision of 49 per cent of investors to pledge support to Knoc, including its two largest shareholders, the fund managers BlackRock and Schroders, the company has stuck to its guns.

That resistance, however, now looks futile following Knoc's surprise move yesterday. In a statement, the Korean company revealed that its adviser, Bank of America Merrill Lynch, had contacted a number of Dana investors before the market opened yesterday and had subsequently been able to buy 29.5 per cent of the shares in the company at the offer price of £18.

Knoc stopped short of acquisitions that would have taken its stake above 30 per cent because that would have automatically triggered a full-scale offer for the company and reset the takeover timetable to which it has been working. However, while some of the shares it acquired yesterday were from shareholders that have already signalled their support, including a large block of stock from Schroders, market analysts now believe the deal is all but done.

Rumours of a rival bidder for Dana have so far come to nothing and the large stake now owned by Knoc effectively prevents another acquirer becoming involved in the deal at the eleventh hour.

Knoc's direct intervention in the market yesterday was made possible by Dana's confirmation last week that it is buying Suncor, a Canadian company with North Sea interests. Knoc, which was given access to Dana's books over the summer, knew about the acquisition; and its inside knowledge prevented it buying any stock until the purchase was announced.

The deal is just the latest takeover or merger in a wave of consolidation in the national resources sector. In many cases the trend is being driven by countries keen to secure a greater share of energy supplies. Further deals are now expected.

Knoc refused to comment last night, and a spokesman for Dana would say only that its advice to shareholders, to do nothing, had not changed.

News
Russia Today’s new UK channel began broadcasting yesterday. Discussions so far have included why Britons see Russia as ‘the bad guy’
news

New UK station Russia Today gives a very bizarre view of Britain

News
people
News
people
Voices
Left: An illustration of the original Jim Crowe, played by TD Rice Right: A Couple dressed as Ray and Janay Rice
voices

By performing as African Americans or Indians, white people get to play act a kind of 'imaginary liberation', writes Michael Mark Cohen

PROMOTED VIDEO
News
i100
Arts and Entertainment
Hand out press photograph/film still from the movie Mad Max Fury Road (Downloaded from the Warner Bro's media site/Jasin Boland/© 2014 Warner Bros. Entertainment Inc.)
films'You have to try everything and it’s all a process of elimination, but ultimately you find your path'
Arts and Entertainment
Imelda Staunton as Dolores Umbridge in the Harry Potter films
books

New essay by JK Rowling went live on Pottermore site this morning

News
people

Top Gear presenter is no stranger to foot-in-mouth controversy

Arts and Entertainment
Keira Knightley and Benedict Cumberbatch at the premiere of The Imitation Game at the BFI London Film Festival
filmsKeira Knightley tried to miss The Imitation Game premiere to watch Bake Off
News
i100
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

The benefits of Recruitment at SThree...

£18000 - £23000 per annum + Comission: SThree: SThree, International Recruitme...

Trainee Recruitment Consultants

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

Finance Assistant - Part time - 9 month FTC

£20000 - £23250 Per Annum pro rata: Clearwater People Solutions Ltd: Pro rata ...

Marketing Manager

£40 - 48k + Benefits: Guru Careers: We are seeking a Marketing Manager to join...

Day In a Page

The drugs revolution starts now as MPs agree its high time for change

The drugs revolution starts now as MPs agree its high time for change

Commons debate highlights growing cross-party consensus on softening UK drugs legislation, unchanged for 43 years
The camera is turned on tabloid editors in Richard Peppiatt's 'One Rogue Reporter'

Gotcha! The camera is turned on tabloid editors

Hugh Grant says Richard Peppiatt's 'One Rogue Reporter' documentary will highlight issues raised by Leveson
Fall of the Berlin Wall: It was thanks to Mikhail Gorbachev that this symbol of division fell

Fall of the Berlin Wall

It was thanks to Gorbachev that this symbol of division fell
Halloween 2014: What makes Ouija boards, demon dolls, and evil clowns so frightening?

What makes ouija boards and demon dolls scary?

Ouija boards, demon dolls, evil children and clowns are all classic tropes of horror, and this year’s Halloween releases feature them all. What makes them so frightening, decade after decade?
A safari in modern Britain: Rose Rouse reveals how her four-year tour of Harlesden taught her as much about the UK as it did about NW10

Rose Rouse's safari in modern Britain

Rouse decided to walk and talk with as many different people as possible in her neighbourhood of Harlesden and her experiences have been published in a new book
Welcome to my world of no smell and odd tastes: How a bike accident left one woman living with unwanted food mash-ups

'My world of no smell and odd tastes'

A head injury from a bicycle accident had the surprising effect of robbing Nell Frizzell of two of her senses

Matt Parker is proud of his square roots

The "stand-up mathematician" is using comedy nights to preach maths to big audiences
Paul Scholes column: Beating Manchester City is vital part of life at Manchester United. This is first major test for Luke Shaw, Angel Di Maria and Radamel Falcao – it’s not a game to lose

Paul Scholes column

Beating City is vital part of life at United. This is first major test for Shaw, Di Maria and Falcao – it’s not a game to lose
Frank Warren: Call me an old git, but I just can't see that there's a place for women’s boxing

Frank Warren column

Call me an old git, but I just can't see that there's a place for women’s boxing
Adrian Heath interview: Former Everton striker prepares his Orlando City side for the MLS - and having Kaka in the dressing room

Adrian Heath's American dream...

Former Everton striker prepares his Orlando City side for the MLS - and having Kaka in the dressing room
Simon Hart: Manchester City will rise again but they need to change their attitude

Manchester City will rise again but they need to change their attitude

Manuel Pellegrini’s side are too good to fail and derby allows them to start again, says Simon Hart
Isis in Syria: A general reveals the lack of communication with the US - and his country's awkward relationship with their allies-by-default

A Syrian general speaks

A senior officer of Bashar al-Assad’s regime talks to Robert Fisk about his army’s brutal struggle with Isis, in a dirty war whose challenges include widespread atrocities
‘A bit of a shock...’ Cambridge economist with Glasgow roots becomes Zambia’s acting President

‘A bit of a shock...’ Economist with Glasgow roots becomes Zambia’s acting President

Guy Scott's predecessor, Michael Sata, died in a London hospital this week after a lengthy illness
Fall of the Berlin Wall: History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War

Fall of the Berlin Wall

History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War
How to turn your mobile phone into easy money

Turn your mobile phone into easy money

There are 90 million unused mobiles in the UK, which would be worth £7bn if we cashed them in, says David Crookes