Medco Cuts Ophir Bid Price Again

Indonesian Medco Energi subsidiary, Medco Global, has slashed its bid for Ophir, the UK oil and gas producer said January 11, from its original unsolicited October bid of £0.58/share down to £0.485/share, compared with the closing price January 10 of £0.43/share. This latter bid values the company at about £340mn ($435mn) and Medco has, as before, until January 28 to formally announce it.

Medco has also withdrawn its original offer to pay contingent value rights in relation to the Fortuna LNG asset in Equatorial Guinea, for which the licence has since been cancelled.

Ophir said at the time that it had entered into discussions with Medco, granting access to due diligence to discuss how Ophir's shareholders could receive appropriate value for the Equatorial Guinea Asset, after which Medco submitted a revised proposal December 20 of £0.538/share against the then market price of £0.33/share. Ophir said January 11 that further announcements will be made as and when appropriate.

On January 2, consultancy Wood Mackenzie commented: "This is a bold move by Medco, and if successful would create a southeast Asian upstream powerhouse. Ophir's current output of 25,000 boe/d combined with Medco's stated 2018 target of 85,000 boe/d would take it to 110,000 boe/d, of which 101,000 boe/d is in-region. This would catapult the firm into being the seventh largest non-NOC upstream producer in southeast Asia, above Hess and BP, and just behind Repsol and Total."