San Leon Energy bought Aurelian Oil and Gas with an issue of new shares to create the biggest foreign holder of shale licenses in Poland, sending the company's stock down by the most in almost five months.
San Leon will pay about £61.6 million (€77 million) in stock for Aurelian, a 13 per cent premium to last week's closing price, the Dublin-based company said in a statement in London.
Aurelian investors will hold 34 percent of the enlarged company and San Leon shareholders will have 66 percent. Prospects for finding shale gas in Poland on a commercial scale prompted ConocoPhillips to buy a stake in licenses in the western Baltic Basin this year.
Exxon Mobil, the world's biggest company, returned some licenses after disappointing drilling results. San Leon fell as much as 16 per cent, the most since June 18th, and slid 14 per cent to 8.28 pence earlier in London.
"A merger with Aurelian makes perfect sense for the shareholders," said Oisin Fanning, the executive chairman of San Leon, who will maintain his role.
"The combined entity offers shareholders material conventional and unconventional plays in stable and highly import-dependent countries."
Bloomberg
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