Royal Dutch Shell Plc  .com Rotating Header Image

The Times: City speculates on new bid for Cairn

October 24, 2007
Steve Hawkes

The takeover speculation that has been sweeping the City’s oil and gas sector reached new highs yesterday as BP was rumoured to be eyeing a possible £3.6 billion bid for Cairn Energy.

Shares in Cairn, the former FTSE 100 explorer, soared nearly 8 per cent, or 158p, to £22.69 and within reach of its highest level of the year.

The jump valued the group at just under £3 billion.

Cairn and BP refused to comment, but industry sources put the talk down to the frenzied atmosphere in the market in the wake of the recent approaches by Eni, the Italian giant, and the Korean National Oil Company for Burren Energy.

One analyst said that investors and hedge funds were desperate to spot the next takeover target early. He added: “The market’s in a state of madness at the minute.”

Hopes of a consolidation wave have been growing for months, given the high oil price and the leading international energy companies’ need to replenish their reserves.

Cairn transformed its fortunes by discovering a one billion barrel oilfield in northwest India, on acreage sold by Shell for little more than $10 million. It recently demerged its Indian operation on the Bombay Stock Exchange but still retains a majority stake.

One analyst said: “Cairn is sitting on a big basin that will have 150,000 barrels of production in 2009, so I very much imagine that some of the big oil companies will be having a look.”

http://business.timesonline.co.uk/tol/business/industry_sectors/natural_resources/article2726871.ece

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

0 Comments on “The Times: City speculates on new bid for Cairn”

Leave a Comment

%d bloggers like this: