Maurel et Prom has made an offer to acquire Wentworth Resources, its partner at a Tanzanian gas project.
The French company has offered 32.5 pence for each Wentworth share, an offer of £61.7 million in total. The company said this was a 30% premium to Wentworth’s 25 pence price as of December 2.
Wentworth has $30.2mn in cash. Netting this out values the company at £37.1mn, a premium of 62.2% to its share price.
Maurel CEO Olivier de Langavant said increasing its stake in the Mnazi Bay gas field was a “logical step and reflects our stated strategy of maximising value from existing assets”.
The Tanzanian gas field is import to Maurel, he said, and the company looks forward to “ensuring it continues to make a positive impact, helping Tanzania meet its increasing energy demands and enabling local development. We are pleased to have agreed a fair value with Wentworth and will provide further updates on the acquisition process in due course.”
Wentworth’s board has recommended the takeover offer. Chairman Tim Bushell said the price offered was a “substantial premium” and an opportunity for shareholders to cash out.
“Having pursued the Company’s stated strategy of further growth in Tanzania in recent years, the Board believes the offer from M&P delivers immediate value to our shareholders at an opportune time,” he said.
It will distribute documentation on the plan in January and expects completion to occur in the second quarter of 2023.
Wentworth has been a dividend-paying stalwart of London’s junior producers, but has struggled to find opportunities to grow. It made an offer to buy out Scirocco Energy’s stake in the Ruvuma project in June. However, the Rovuma operator pre-empted the deal.