Government owned oil majors Oil and Natural Gas Corp (ONGC) and GAIL India is likely to offer $2 billion to acquire Africa-focused gas explorer Cove Energy, joining a bidding war over the UK-listed company.
Both the companies are aiming to beat a $1.77 billion bid by Thai state-controlled oil and gas group PTT and Royal Dutch Shell Plc's offer worth $1.6 billion earlier this month, which already represented a 70% premium to Cove's share price when it announced plans to sell in January.
GAIL India and ONGC Videsh, the overseas investment arm of oil explorer and producer ONGC will make their combined bid this week. The state-run consortium may value London-listed Cove at 245 pence-a-share. The move of the state run company reflects intense industry interest in East Africa, a previously little-explored area which is tipped to become a major natural gas producing region.
