Scotland business

Aberdeen's Bridge Energy agrees to £103m takeover offer

Oil rig
Image caption Bridge Energy holds several production licences in the UK North Sea

Shares in Aberdeen-based Bridge Energy rose sharply on Monday after it agreed to be taken over by oil and gas explorer Spike Exploration in a deal which values the business at £103m.

Spike is bidding to acquire the entire issued share capital of Bridge through a voluntary cash tender offer equivalent to about 162p per share.

Bridge's board has recommended that its shareholders accept the offer.

Shares in Bridge climbed nearly 30% by Monday lunchtime to reach 157.50p.

Bridge holds several production licences in the UK North Sea.

The company, which is listed on Oslo and London stock exchanges, also owns exploration assets in both the UK and Norwegian continental shelves.

Bridge has drilled 18 exploration and appraisal wells, including ten discoveries.

The company said the transaction offered Norwegian-owned Spike "exposure to high potential exploration opportunities, near-term development and cash flow from existing production".

'Fair valuation'

Chief executive Tom Reynolds said: "We are pleased to announce that Bridge has received a cash offer from Spike Exploration.

"The board decided to recommend this offer as it reflects a fair valuation of our portfolio and a significant premium to the recent trading range.

"By tendering their pre-acceptances, several of our largest shareholders have already recognised that this is the optimal path to realising value without further operational risk and additional funding.

"It allows us to crystallise the value created within the company by the Bridge team during and prior to our time as a listed business and will return valuable cash to shareholders."

Bridge was established in 2010 as a growth business focused on both the UK and Norway.

It currently has four producing assets which contribute about 1,100 barrels of oil equivalent per day.

Bridge estimates that production from its existing portfolio will exceed 10,000 barrels per day within five years.

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