Thailand’s PTT beats Shell bid for Cove Energy

BANGKOK—Thai oil giant PTT said Wednesday it had struck a deal to buy East Africa-focused Cove Energy for £1.22 billion ($1.92 billion), trumping a rival offer from Royal Dutch Shell.

PTT Exploration & Production PCL (PTTEP) increased its cash offer for Cove to 240 pence a share, from an earlier bid in February of 220 pence, it said in a statement to the London Stock Exchange.

The deal is a blow to Royal Dutch Shell, which last month said it had reached an agreement to buy Cove Energy for £1.12 billion, or 220 pence per share.

PTT said the directors of Cove would unanimously recommend that shareholders of the London-listed company accept its bid and said they had withdrawn their previous recommendation for the Shell offer.

“The bid from PTTEP represents significant value for shareholders and confirms the world-class nature of Cove’s East African assets,” Cove Energy chief executive John Craven was quoted as saying in the statement.

PTT and Cove are already partners in several East African energy projects including a promising gas field off the coast of Mozambique.

“We are delighted to have announced a recommended offer to acquire Cove and all its assets,” said PTTEP chief executive Tevin Vongvanich.

“This acquisition illustrates our commitment to leveraging the LNG [liquefied natural gas] value chain of the PTT Group and is consistent with our long-term strategic priorities.”