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Deltic Energy shares on positive ground as Reabold withdraws takeover interest

Deltic rejected Reabold's offer last month claiming it placed no value on its significant non-cash assets.

Deltic Energy PLC - Deltic Energy shares on positive ground as Reabold withdraws takeover interest

Deltic Energy PLC (LON:DELT) shares moved in positive territory on Monday after Reabold Resources Plc (LON:RBD) withdrew its interest in acquiring the North Sea company.

Reabold in a statement said it does not intend to make an offer for Deltic.

Deltic in mid-July rejected the proposed share-based takeover offer which, at 1.5 Reabold shares per Deltic share, was pitched at £12.3mln or 0.87p per share.

“Reabold’s offer valued the Company at £12.3m, a small premium of £1.2m on its market cap at the time,” said Sam Wahab, analyst at stockbroker SP Angel.

READ: Deltic’s largest shareholder backs takeover defence

“Even in today’s subdued market, it was always going to be a challenge for Reabold to convince Deltic’s shareholders to accept such a small return on investment in our view.”

In a statement on July 16, Deltic said the offer placed no value on its significant non-cash assets and 'not least its share of two potential high impact exploration wells with partner Shell'.

The offer did not even reflect its existing cash balance (£13.2mln), added Deltic, which said it also had concerns over Reabold's investments and the West Newton project in Yorkshire in particular,

The takeover would have seen Reabold shareholders own approximately 76.2% of the combined group's issued share capital and Deltic shareholders approximately 23.8%.

Quick facts: Deltic Energy PLC

Price: 0.875 GBX

Market: AIM
Market Cap: £12.3 m

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