Energy Africa's board of directors today claimed they had no choice but to accept a $500 million bid from Tullow Oil.
The South African-based oil and gas exploration company submitted to the takeover after Tullow Oil won the support of 90.5 per cent of Energy Africa's shareholders, who agreed to sell their stake last week for $4,8346 a share.
But in a statement the board of directors voiced their disappointment with the price and suggested the bid should have reflected the potential for continuing high oil prices.
The merger means Tullow Oil is now one of the biggest oil firms focused on West Africa with effective ownership of Namibia's envisioned Kudu gas project.
Tullow Oil's chief executive, Mr Aidan Heavey said: "The proposed acquisition of Energy Africa by Tullow will create a formidable independent oil and gas company with core areas in West Africa and the UK".
Energy Africa's accounts for the end of last year showed the company had proved and probable oil and gas reserves of 57,9 million barrels of oil equivalent and produced a further 8,1 million in 2003.
As well as retaining a 90 per cent stake in the Kudu gas project, situated 180 nautical miles off Namibia's Atlantic coast, the company's operations stretched through Africa's Equatorial Guinea, Gabon and Congo.
Tullow Oil shares were up by 0.5 per cent this morning following confirmation of the acquisition.