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(Sharecast News) - AIM-listed oil and gas exploration company Challenger Energy said on Thursday that it has agreed to be bought by Canada's Sintana Energy in an all-share deal that values the group at around £45m.
Under the terms of the deal, Challenger shareholders will receive 0.4705 new Sintana shares for each of their shares and will own around 25% of the combined group.
The price is a 44% premium to the closing Challenger share price on Wednesday.
Sintana is a TSXV-quoted oil and gas exploration company with a primary portfolio of assets in Namibia.
Challenger chairman Iain McKendrick said: "This recommended merger fulfils all the strategic intentions of Challenger, creating an entity with a diversified and very high-graded portfolio, and which will be a springboard to further excellent returns for both sets of shareholders."
Sintana chief executive Robert Bose said: "The combination of Sintana and Challenger delivers on our long-term strategy to create and execute on a portfolio of exposures to high-impact exploration opportunities.
"Expanding our aperture to capture the promise of the Atlantic margin from Namibia and Angola to Uruguay with a diversified portfolio of development and exploration assets creates a market leader positioned to deliver significant success."
At 1020 BST, Challenger shares were up 6.7% at 13.42p.
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