By Jaime Llinares Taboada
Tullow Oil PLC said Wednesday that it has agreed to merge with Capricorn Energy PLC.
The combined group could be worth 1.42 billion pounds ($1.79 billion), based on Tuesday’s closing price.
Capricorn shareholders will receive 3.8068 new Tullow shares for each Capricorn share held, granting them a 47% stake in the enlarged entity.
Tullow said that the merger would realize annual cost synergies of $50 million and create a leading energy company in Africa.
Upon completion, the chief executive of the group would be Tullow’s CEO Rahul Dhir. Capricorn’s chief financial officer James Smith would also retain his role in the combined entity.
Write to Jaime Llinares Taboada at email@example.com; @JaimeLlinaresT