Seplat Petroleum Development Company

Seplat Petroleum is to acquire London-listed Eland Oil & Gas for £382 million ($486,163,760.00) in a bid to scale the business and grow in Nigeria, according to the boards of the companies.

The acquisition is to be effected by means of a scheme of arrangement under Part 26 of the Companies Act.

Seplat will pay 166 pence per share in cash for Eland, or a premium of 28.5 percent to Monday’s closing price. Shares in Eland climbed 28 percent in early trading on Tuesday.

Eland’s board has backed the offer, as have its three largest shareholders, who have given irrevocable commitments for about 60 percent of the shares in the company.

The acquisition will be financed through a combination of existing cash and a new loan facility.

According to the companies, the deal will give the combined business greater scale in production and reserves, with the combined oil production set to increase to 38,000 barrels of oil per day (boepd) for the enlarged group.

Factoring in Seplat’s gas production, total production is expected to grow to 64,000boepd.

In interim results released in September, Eland, founded in 2009, reported an operating profit of $40 million on record revenues of $106 million, up from $67.4 million in the previous year.

Seplat currently supplies about a third of Nigeria’s power generation gas.

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