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Soco International ends merger talks with Kuwait Energy
Soco International said on Monday that merger talks with Kuwait Energy have ended.
The oil and gas exploration and production company, which announced back in January that it was evaluating a potential merger of equals, said it could not reach agreement with Kuwait Energy on the basis for an acceptable transaction.
"Soco's board remains committed to its strategy of shareholder value creation through sustainable cash returns to shareholders and growth of the business. The Soco team, which has a track record of delivering shareholder value through asset acquisition and monetisation, delivering large scale developments, and returning capital to shareholders, evaluates M&A opportunities with reference to strict strategic, financial and operational criteria and only pursues transactions if they are determined by Soco's board to be in the best interest of shareholders. Soco's board continues to evaluate opportunities in accordance with these criteria."
RBC Capital Markets said: "We think there may be a relief rally today following this announcement, as the deal was seen to be a challenging combination of geographies and the market had shown little appetite for Kuwait Energy's portfolio when it had sought a London listing previously.
"Soco has, however, to galvanise investor interest in its acquisition-led strategy as the stock tests historic lows."
At 0920 GMT, the shares were up 3.3% to 95p.