Capricorn Energy Shares Decline as DNO Withdraws From Bidding Contest

Shares in Capricorn Energy (CNE) fell sharply on Thursday after Norwegian oil and gas producer DNO ASA announced it would not increase its takeover offer for the UK-based company. The decision effectively clears the path for a competing, higher bid from rival suitor Genel Energy.

DNO Holds Firm on Offer

DNO and its subsidiary DNO Bidco stated that the financial terms of their revised all-cash offer of $5.214 per Capricorn share are final and will not be increased. The company said it maintains a "highly disciplined approach to M&A" and will not elect to implement its offer through a contractual offer, according to a company statement.

Genel Energy in Leading Position

DNO's withdrawal from the bidding process follows an increased cash offer for Capricorn tabled by Genel Energy on September 25. Genel's proposal appears to have secured significant shareholder support, a key factor in the contest.

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• According to DNO's statement, Genel Bidco has already secured irrevocable undertakings representing approximately 39.1% of Capricorn’s issued share capital.

This level of commitment from existing shareholders leaves Genel's offer as the leading proposal for Capricorn's board and investors to consider.

Context and Company Outlook

The competing bids for Capricorn highlight ongoing consolidation activity in the UK oil and gas sector. While stepping back from this specific deal, DNO confirmed it continues to evaluate investment opportunities in other regions, including the North Sea, the Kurdistan Region of Iraq, and Egypt. The company also noted its ongoing positive relationship with Genel, with which it partners in the Tawke licence in Kurdistan.