There’s a takeover on the way at Encore oil. Rumours of Premier oil coming back for the company are being openly discussed. Back in late January early February there were strong rumours of a 200p Premier bid being discussed the recent fall in the share price due to the downgrading of Cladhan and the north sea tax hike coupled with the company cock-up of the XEO float have rocked the sp however it is looking like a move is on the cards here from one of their partners. Premier being the one most likely.
TAKEOVER! Is back on the agenda here!
Make of it what you will but at these prices they are at bargain basement. The recent Director buys are being espoused through-out the trading houses as a vote of confidence in the company by the Board. Expect more Director buys. This share is hotting up in anticipation of a Premier Oil bid! 100/110p being the range.
And here’s a few wise words from the sector watcher!
“Adding cash/investments gives a further 13p/share, i.e. a total of 85p/share, or 50% above the current price. Clearly the disappointment in Cladhan has a had a devastating impact on the shares, as recently as February there were strong rumours that Premier Oil was thinking of launching a 200p/share takeover bid for the company. However, I’d say that if PMO wasn’t looking at the group then, it certainly should be now, especially with its huge pool of North Sea tax losses, meaning that the Cladhan/Catcher reserves would theoretically be much higher value than our assumed $12/barrel. Moreover PMO would be using a much lower cost of capital than 12%. Hence at these depressed levels I’d be tucking a few away.”
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