Shell said last week that shareholders in Aim-listed Cove now have until 27 June to accept its £1.12bn or 220p per share offer, but the firm is reportedly working towards an improved offer to compete with rival energy firm PTT, which tabled a 240p bid.
Cove shareholders will have the chance to press the board on its preferred bidder at the company’s annual meeting on Wednesday.
Cove’s shares remained above both offer prices at 264p on Friday, with less than five per cent of shareholders giving their blessing to Shell’s advances. The shares have remained firmly above Shell’s initial offer price since its interest was revealed on 21 May.
And analysts are expecting a substantial price bump from Shell’s counter-offer, which is expected within the next couple of weeks.
“I think Shell will come back,” Investec analyst Stuart Joyner said last week. “They could possibly pay up to 300p per share, possibly more, given the recent discovery.”
Much of Cove’s value comes from its stake in a lucrative gas discovery off Mozambique.
Morgan Stanley is acting as financial adviser for Shell, while Cove is taking advice from Standard Chartered and Cenkos Securities.