Wellstream confirms takeover bid is causing shares in the UK to skyrocket

BRITISH oilfield services group Wellstream Holdings said it had received several bid approaches, lifting its shares 30 per cent and valuing the company at over £700m.

Wellstream, which was floated on the stockmarket in 2007 by British private equity firm Candover, makes flexible pipes used by oil companies in deep water, an area set for strong growth due to major finds in Brazil and the Gulf of Mexico in recent years.

The firm said it had “received a number of preliminary approaches regarding a possible offer for the company” but there was “no certainty that an acceptable offer will ultimately be made”.

The statement follows a five per cent rise in Wellstream shares on Monday.

“The possible offers for Wellstream highlight the M&A potential for the oil service sector at this stage in the cyclical recovery,” said Keith Morris, oil analyst at Evolution Securities.

Wellstream is a frequent subject of takeover rumours, with market chatter often linking it to Europe’s largest oil services company, Saipem.

ANDREW OSBORNE

BANK OF AMERICA MERRILL LYNCH

Managing director of corporate broking at Bank of American Merrill Lynch, Andrew Osborne, is the top leader on the possible takeover of Wellstream.

Osborne, who is short-listed for the City A.M. Dealmaker of The Year award, is known as the go-to guy for the mid-cap energy and power sector.

Most notably, Osborne advised Tullow Oil on its £1bn fundraising to pay for the buying rights to exploration on the shores of Lake Albert. The deal, which happened earlier this year, saw Tullow move into the premier league of oil explorers.

Osborne cut his teeth at Hoare Govett but he was poached by Merrill Lynch in 2004 by then chairman Bob Wigley.

Other advisers on the Wellstream deal, include a team from Credit Suisse which is being led by investment banking managing director, John Hannaford.

City law firm Clifford Chance has taken lead legal role, with London corporate partners David Lewis and Tim Lewis managing the deal.