Reports that state-run Korean National Oil Corporation (KNOC) is set to purchase Imperial Energy, a Russian based company, have been both confirmed and denied in a will-they-or-won’t-they style acquisition.
According to a KNOC company source they have never expressed an interest in buying Imperial Energy.
However, recent news reports have said quite the contrary, and have stated that KNOC have been interested in Imperial Energy, along with India's Oil and Natural Gas Corp Ltd, and China's Sinopec Group, parent of top Asian refiner Sinopec Corporation. The story of competition for the acquisition of Imperial was only made stronger when confirmed by a source from the Indian government.
The unnamed official, said: “We are waiting for it. We have submitted the bid. Our bid is very competitive ... it will take 2-3 days, maybe next week you will hear something.”
Although the amount of the bid - alike the approach itself - is yet to be officially revealed, it has been reported that ONGC has submitted an initial bid of £12.90 per share, which totals out at around $2.96 billion.
In the past KNOC has kept its desire to expand no secret and has vowed to continuously hunt for foreign energy firms after it lost out in its bid to buy UK-listed Burren Energy BUR.L in 2007.
The official value of Imperial Energy is estimated to be around $2.8 billion to $2.96 billion, according to market sources. The price is well within the depths of KNOC's coffers for acquiring energy firms. ONGC was reported to be prepared to pay up to $3.5 billion.
Listed on the London Stock Exchange, Imperial Energy has oil operations in the Tomsk region of western Siberia, as well as a 75% interest in Sevkazgra, a limited liability partnership registered in Kazakhstan, which holds a license to explore 780.7 square miles in an area of north-central Kazakhstan known as the Torgai block. The Russian-based oil company itself confirmed, in early August, that it had been approached in relation to a possible cash offer.
Imperial Energy has in the past drawn the attention of various oil giants because of its potential as a gateway to Russia - which has frequently been hostile to foreign investment into its vast energy reserves.
Unsurprisingly, following reports in The Financial Times of a takeover, Imperial Energy rose in trading in London on Friday.
With the prospect of a bidding war looming, shares of Imperial Energy climbed as much as 35 pence, (2.9%), to 1,243 pence and traded up 1.9% at 1,231 pence by 11:17 A.M. GMT.
