Ukraine-Based Cadogan Abandons Takeover

Ukraine-based Cadogan Petroleum abandoned plans to take over Ascent Resources in the evening of March 31, just two days after confirming the company was its potential target.

Cadogan noted that Ascent’s share price at close of business on March 30 was at a 658% premium to its £0.0093 price just seven days earlier, the business day prior to Ascent’s announcement that it and Cadogan might combine.

Cadogan said it had conducted extensive due diligence on Ascent and its Petisovci Gas Project, in northeast Slovenia close to the Hungarian and Croatian borders, adding however that the share price rise had taken Ascent’s enterprise value above a level that Cadogan was prepared to pay. “As a result, Cadogan confirms that it does not intend to make an offer for Ascent.”

Under UK stock market rules, Cadogan has until 5pm on April 21 either to put up or shut up regarding such a takeover offer. AIM-listed Ascent’s share price closed at £0.0598 on March 31, down 15% on the day. But by 9am on April 1 the price had fallen to £0.0258, down 57% from the March 31 close.

In an April 1 statement, Ascent thanked Cadogan for the interest shown in the company and in the Petisovci asset’s potential, adding it is confident that first gas during 2016 is achievable. 

Based on 3D seismic, Ascent describes the Petisovci area which it operates as containing “substantial tight gas reserves, as well as shallower conventional oil and gas”, in which it is partnered by Geoenergo – a 50-50 joint venture of two Slovenian firms, Petrol and Nafta.

Geoenergo has said that two wells (Pg-10 and Pg-11) were drilled in 2011 to depths of some 3,500 meters, with both fracture-stimulated and both testing gas at commercial flow rates.

Mark Smedley