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Saga recommends Norsk bid
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June 11, 1999: 6:31 a.m. ET
Norwegian oil firm accepts $2.6B 'domestic solution'
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LONDON (CNNfn) - The board of Norway's Saga Petroleum voted Friday to recommend an increased 20.1 billion Norwegian crown ($2.56 billion) joint takeover bid by state-controlled Norsk Hydro and Statoil.
The two firms raised their stock and cash bid by 25 percent Thursday to 135 crowns a share, trumping a 125 crown cash offer by France's Elf Aquitaine.
Saga shares fell 3 percent to 131.5 crowns ahead of the announcement while Norsk, which is 51 percent owned by the Norwegian government, lost 4.1 percent at 312 crowns.
Analysts feared the Norwegian companies had bid too high for Saga, citing a consensus fair value around 125 shares.
Norsk and Statoil, which is wholly government owned, require acceptance from 70 percent of Saga shareholders for their combined three-for-one stock split offer which also includes a cash element equivalent to 27 crowns. The offer expires June 18.
Saga's unions opposed the Norsk-Statoil bid fearing heavy job cuts as Norsk folds Saga's operations into its own.
Elf Aquitaine shares rose 2.24 percent to 137 euros. The shares were marked up by analysts who doubt it will raise its own offer to an unsustainable level.
-- from staff and wire reports
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