A major shareholder in North Sea oil producer Ithaca Energy has issued a statement urging fellow investors to reject a $1.24bn (£1bn) takeover deal.
Ithaca’s board accepted a bid from Delek Group, which is currently the company’s largest shareholder with a 19.7 per cent stake, in February.
The deal values Ithaca’s share value at $646m and gives the firm a total enterprise value of around $1.24bn.
Ithaca, which is listed on the Alternative Investment Market (Aim), today sent out a directors’ circular recommending shareholders accept the deal. The offer will be open for acceptance until 20 April and investors have until this date to deposit their shares. The deal is conditional on 50 per cent of non-Delek shares being deposited in favour.
Paul Mumford, a fund manager at Cavendish Asset Management, which owns a three per cent stake in Ithaca and has opposed the deal since it was announced, yesterday urged fellow shareholders to “sit tight”.
“We do not feel the reasons given for recommending the current offer are compelling, as they fail to take into account the long-term prospects of Ithaca,” Mumford said.
“The timing is ideal from Delek’s perspective as Ithaca would be acquired at an opportunistic price. They are prepared to buy the company at the current level and ‘what is good for the goose might be better for the gander.’”