Tullow Oil poised for Africa bid

NORTH Sea operator Tullow Oil is about to announce the £280m takeover of Energy Africa, funded by a £100m-plus placing and the issue of new shares.

Energy Africa is listed on the Johannesburg Stock Exchange and has extensive West African interests as well as some British operations.

Tullow chief executive Aidan Heavey will announce the deal alongside annual results on Tuesday. The company is expected to show a 25% jump in operating profits.

Tullow's shares were suspended in March ahead of the Energy Africa deal at 86 1/ 2p, valuing the company at £320m. Trading in the shares is likely to resume this week.

It is believed the share placing, carried out by Tullow's broker Hoare Govett, was achieved at a premium of about ten% to the suspension price with the shares bought by a range of institutions.

The deal is a major one for Tullow and should see its production almost double as well as expanding its geographical reach beyond the North Sea.

Energy Africa has been available since last November when its majority owner, Malaysia's stateowned Petronas, announced its intention to sell.