Seplat settles dispute with Eland Oil stakeholders over acquisition

The issues arising from the acquisition of Eland Oil & Gas Plc by Seplat Petroleum Development Company Plc has been reportedly settled amicably.

The Nation reported that stakeholders in Seplat, as well as some aggrieved stakeholders in Eland, have concluded talks, making the transaction acceptable to all stakeholders.

The Backstory: The terms of agreement of the planned acquisition of Eland Oil and Gas by Seplat entailed Seplat paying 166 pence a share for Eland in a purchase valuing the London-traded company at about $484 million. Eland’s directors recommended that shareholders vote in favour of the deal, which represents a premium of 33% to the six-month average share price.

According to the agreement, any shareholder of Eland Oil & Gas, whose name appeared on the register as at close of business on Friday, October 18, would stand a chance of receiving and retaining the interim dividend, which the company had planned to pay on October 31, 2019.

The Eland’s board of directors had signed an undertaking to that effect. However, one of the stakeholders, Starcrest Nigeria Energy Limited issued a warning on the proposed acquisition of Eland Oil and Gas Plc by Seplat Petroleum Development Company.

Recall that Nairametrics had reported that Starcrest issued warnings stating that there were fundamental misrepresentations, or material omissions in representation, which were made to the market in general and to the respective shareholders.

Resolutions: Nevertheless, the matter has been resolved as it was reported that Emeka Offor, the Chairman of Starcrest Nigeria Energy Limited; George Maxwell, CEO of Eland and Bryant Orjiako, Chairman of Seplat met in London to settle the stand-off. The outcome of the meeting is reportedly favourable to all the parties while the acquisition process would continue.

Also, the boards of Eland and Seplat have announced that all the proposed resolutions for the take-over were duly passed at the Court Meeting and the General Meeting held on November 20, 2019, by Eland and convened in relation to the proposed scheme.

What you should know: The acquisition of Eland would boost Seplat’s production to 64,000 barrels of oil equivalent a day which would propel Seplat to become Nigeria’s biggest oil exploration and production company.

It represents a big boost to the Nigerian Local Content Act, which stipulates that Nigerian operators and indigenous service companies shall be given first consideration in award of oil blocks, licences and works in the sector.

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