British Gas owner Centrica has secured a breakthrough in its £1.3 billion takeover battle for North Sea oil and gas firm Venture Production.
The utility giant has amassed a controlling stake after purchasing 12.6 million shares in morning trading to lift its holding by 8.4 per cent to 40.1 per cent.
With acceptances from other shareholders for its takeover offer accounting for a further ten per cent, Centrica effectively holds 50.3 per cent of the company’s shares. The next threshold of 75 per cent would allow Centrica to delist Venture and implement plans without having to seek approval from other shareholders.
The energy firm has launched a bid for the Aberdeen-based company in order to boost its gas production and reduce dependence on volatile wholesale markets. Centrica currently produces about 35 per cent of its energy needs out of its own resources, although this should increase to 45 per cent with its acquisition of a 20 per cent stake in nuclear power firm British Energy from French energy giant EDF.
Buying Venture would mean that Centrica could supply 60 per cent of its energy from its own assets and resources.
Venture is an exploration and production company which acquires, develops and brings into production discovered but undeveloped oil and gas fields in the North Sea.
In 2008, the firm virtually doubled operating profits to £231 million with revenues up 38 per cent to £494.9 million after higher production levels and commodity prices.
Venture’s chairman John Morgan has called the bid “opportunistic” and recently urged shareholders not to sell their shares “on the cheap” to Centrica.
The utility firm took a stake in Venture in March and has upped its holding since then, including the acquisition of private equity firm 3i’s 5.4 per cent share. The takeover received EU clearance last week.