Enterprise Oil Unveils £1.5 Billion Bid for Lasmo in Largest Hostile Takeover Battle in 5 Years

Enterprise Oil, a leading oil explorer, has launched a hostile takeover bid for rival Lasmo, worth almost £1.5 billion. The bid, which consists of 27 Enterprise A shares and 12 Enterprise warrants for every eight shares held by Lasmo investors, has been met with resistance from Lasmo's top management and shareholders. Lasmo has lost over £500 million in the past two years, mainly due to write-downs in asset values, and Enterprise claims that the company lacks the funds to exploit its assets effectively.

Key Takeaways:

• Enterprise Oil's bid for Lasmo is worth almost £1.5 billion, making it the largest hostile takeover battle in 5 years.
• The bid consists of 27 Enterprise A shares and 12 Enterprise warrants for every eight shares held by Lasmo investors.
• Lasmo has lost over £500 million in the past two years, mainly due to write-downs in asset values.
• Enterprise claims that Lasmo lacks the funds to exploit its assets effectively, despite a recent rights issue.
• Lasmo's top management has changed over the past two years, but Enterprise is not convinced that there has been a fundamental change in approach.
• The takeover battle is under investigation by the Stock Exchange, which is looking into the sharp pre-bid surge in Lasmo shares.

Statistics:

• Lasmo's share price has fallen from 480p in 1990 to 157 1/2 p.
• The company has written down assets worth over £500 million in the past two years.
• Enterprise Oil's bid is worth almost £1.5 billion.
• The takeover bid consists of 27 Enterprise A shares and 12 Enterprise warrants for every eight shares held by Lasmo investors.
• The structure of the bid allows for board representation for Lasmo shareholders.

Sources:

• The London Financial Times, 1995
• The London Stock Exchange, 1995
• Enterprise Oil Press Release, 1995
• Lasmo Press Release, 1995