Eni Backs Down From Burren

Italian utility Eni has today announced it is pulling out of its prospective buy out deal of UK-based oil company Burren Energy after the target sought to increase its valuation in the deal beyond the initial £1.7 billion offer, in a move which would have seen the company substantially increase its investment portfolio and service range at a time where oil prices are beating all time records and demand is continuing to rise.

Eni made a bid for Burren valued at £12 per share including a premium in order to acquire the business and assets of the company, although this was rejected at a preliminary stage for being too low by the FTSE 250 company which values its business at a greater rate by virtue of its advantageous external market conditions.

Burren was seen to be an attractive takeover prospect as a result of its diverse stock holdings and commercial interests which range across a wide geographic region and across several market sectors. Of note are its operations in the Middle East, Central Asia and North Africa, as well as its holdings in Hindustan Oil Exploration and the shipping industry.

Additionally with oil prices and demand soaring, the business looks set to grow from strength to strength over the coming years. However the back down by Eni today has seen share prices pull back, losing almost 15% of their value, despite the fact that there may still be a takeover approach from several other rumoured sources.

Critics have slammed the decision to reject the initial offer as greedy, and it has been suggested that the money offered by Eni would have been of sufficient value to reflect the business and assets of the company at the present time.

However it would now appear that talks between the two companies have irretrievably broken down, leading to the share price slump reported today.

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