Petroceltic advises shareholders to take no action on Worldview bid

Worldview, which has a 29.6% stake in Petroceltic, made the offer on Friday through its subsidiary Sunny Hill. However, the price offered represents a discount of 83.3% to the closing price of Petroceltic on 25 February and a 73.9% discount to the closing price on 21 January, which was the last trading day prior to the announcement.

Petroceltic currently has debt of more than $200m and Worldview made the offer on the basis that it believes the equity in the company is close to zero. The company was recently given waivers on debt repayments as it carries out a strategic review.

Petroceltic said on Thursday: “The board believes that the overall funding position of the company is a critical determinant of the value, if any, that may be realised through the Strategic Review and, given the group's current circumstances, there can be no certainty that Petroceltic Shareholders will realise any value from their holding of Petroceltic shares.

“The board believes that the offer undervalues the company on the assumption of its having appropriate long term funding in place.”

The company said Worldview’s offer provided no information on how Petroceltic is to be funded during the offer period, to allow the completion of the offer.

In addition, there was no information on the proposed treatment of the company's senior bank facility both during the offer period and upon any change of control of the company, which, unless waived by the lenders or otherwise amended, would trigger an immediate repayment obligation in respect of all amounts owing.

“Petroceltic shareholders should be aware that there is no certainty that the company will continue to receive waivers from its lenders or that it will be able to secure funding on acceptable terms to enable it to complete the Strategic Review and/or the offer or achieve an outcome for Petroceltic shareholders that is superior to the offer.”

At 1436 GMT, shares in Petroceltic were down 20% to 8.13p.