Last checked at 
(Alliance News) - Seplat Petroleum Development Co PLC has agreed a GBP382 million purchase of fellow Nigeria-focused energy firm Eland Oil & Gas PLC, the companies said Tuesday.
Seplat has offered 166 pence per Eland share, a 29% premium to Eland's closing price in London on Monday. Eland shares were 28% higher Tuesday morning at 164.80p.
Eland shareholders will also be able to still receive the 1p interim dividend previously declared.
Seplat owns assets in the Niger Delta region of Nigeria, as does Eland. Seplat produced 49,867 barrels of oil equivalent per day in 2018, while Eland's was 8,000 barrels per day.
Eland's Chief Executive George Maxwell said: "This recommended offer from Seplat represents the culmination of a very successful journey by Eland, the management team and all of its stakeholders.
"Since founding Eland, we have, jointly with our partners in Elcrest, acquired our interests in OML 40, a non-producing asset, achieved an all-time record production on this asset and become a significant independent producer in Nigeria's exploration & production landscape and one of the biggest oil producers on London's AIM market."
"Eland has, in a period which has seen a significant cyclical downturn in our industry, outperformed most of its peers and the AIM Oil & Gas Index. This transaction represents a record share price for Eland and crystallises Eland's stated goal to maximise shareholder value," Maxwell added.
Seplat's Chair Bryant Orijako said the firm "firmly" believes Eland is a complementary fit, and Seplat CEO Austin Avuru added: "We are pleased to have reached an agreement to acquire Eland and its portfolio of assets that will enhance our existing operations. Eland is an excellent fit with Seplat and the combination should achieve for us growth and increased profitability, creating value for our shareholders, employees and other stakeholders while offering an attractive upfront premium to Eland shareholders.
"The acquisition, made possible by our robust operational platform and headroom in our capital structure, is in line with a key part of our established strategy which is to pursue opportunities in the onshore and offshore areas of Nigeria that offer near term production with cash flow and reserves potential."
"The acquisition reinforces Seplat's status as one of Nigeria's leading indigenous, independent E&Ps and will create a Nigerian E&P champion with the footprint and technical capabilities to further grow and consolidate in Nigeria," Avuru continued.
Seplat will fund the acquisition via existing cash as well as with a new loan facility.
By George Collard; georgecollard@alliancenews.com
Copyright 2019 Alliance News Limited. All Rights Reserved.
