Following the announcement of the acquisition of Eland Oil & Gas by Seplat Petroleum Development Plc as notified on the Nigerian Stock Exchange (NSE) and reported by Nairametrics, a firm, Starcrest Nigeria Energy Limited has issued a stern warning.
Starcrest made known that misrepresentations or ommissions were made to the public by Seplat Petroleum and Eland Oil and Gas.
According to Starcrest Counsel, Ogochukwu Ifeoma Aniekwe, as seen on Yahoo Finance, the acquisition, which is based on Seplat Petroleum owning a 45% stake in an oil mining lease held by Eland Oil and Gas, is not true as Eland is not the operator of the license as portrayed to the general public.
In a statement, Aniekwe disclosed that the 45% stake was instead, held by a Nigerian company, Elcrest Exploration and Production Company Limited. Elcrest, which should have been informed of the acquisition plans, was not duly informed of it.
Aniekwe said that the operator of the license itself is The Nigerian Petroleum Development Company. The statement read:
“In the absence of guarantees we have sought from the offeror since the announcement on, inter alia, the offeror’s subscription to the continued autonomy of Elcrest in accordance with Nigerian law, we are unable to guarantee the continued existence of Elcrest, and therefore of Elcrest’s entitlement to the stake in the License, if the Acquisition proceeds.
“The Nigerian Petroleum Development Company, a state-owned enterprise, is the holder of the majority 55% stake in the License and is the operator of the License. Neither the offeree nor Elcrest is the operator of the License.”
More details: Apparently, going by Starcrest’s claims, Eland Oil and Gas has no direct stake in the license supposedly acquired by Seplat Petroleum. According to the statement, Starcrest and Elcrest will take up the matter with legal advisers and relevant authorities in Nigeria and the United Kingdom.
“The offeree has no direct stake in the License. The offeree also has no direct entitlement, under Nigerian law, to the hydrocarbons produced from the License. The offeree is entitled to dividend from Elcrest in which the offeree is a minority shareholder but only if and whenever Elcrest declares dividend.
“We are taking up the matters stated in this notice with the relevant authorities in Nigeria and the United Kingdom, and continuing consultation with our legal advisers on appropriate recourse,” Aniekwe stated.
The supposed terms of agreement as reported on Nairametrics include:
- Every Eland Oil & Gas shareholder will receive 166 pence in cash per share.
- The entire issued and yet to be issued ordinary share capital of Eland Oil & Gas has been valued at approximately £382 million.
- On a fully diluted basis, this represents a premium of 28.5% to Eland’s closing share price of 129.2 pence on 14 October 2019.
- It also represents “a premium of approximately 32.6% to the three-month volume-weighted average price per Eland Share as of 14 October 2019 of 125.2 pence.”
- Any shareholder of Eland Oil & Gas whose name appears on the register as at close of business on Friday, October 18th, will stand a chance of receiving and retaining the interim dividend which the company is set to pay on October 31st, 2019.
About Starcrest Nigeria Energy Limited: Starcrest Nigeria Energy Limited is an independent oil and gas exploration and production company focused on oil and gas exploration and production in Nigeria and the Gulf of Guinea region. The company, which is a member of the Chrome Group of companies, has interests in OPL 291 Nigeria and in Elcrest Exploration and Production Nigeria Limited.