Earlier in the year, Seplat announced it was considering acquiring or merging with Afren. Afren, a UK listed company with operations in Nigeria has been facing financial turmoil following the scandal that saw one of its founders resign.
The company’s share price had tanked more than 80% and had secured debt rescheduling from its creditors. This made it a likely target for Seplat which had been buying up its shares gradually. Afren will later confirm that it was no longer continuing with the proposed deal after multiple extension of a deadline for Seplat to produce a letter of intent.
Seplat in its recent AGM has now explained why it did not go ahead with the transaction. According to its CEO, Austin Avuru, he said the company looked at the issue in detail and determined that it was not in the best interest of Seplat and its shareholders to go ahead with the merger.
“Particularly because we didn’t have an opportunity to have the kind of engagement we wanted with the creditors to Afren… We thought that unless we have fruitful and full engagement with the creditors, it will not be in our interest and in the interest of shareholders to go ahead,” he said.