New oil discoveries in Ghana make Tullow more attractive

Tullow Oil’s announcement of new discoveries in Ghanaian waters is making it more attractive to potential bidders, amid growing speculation about a likely takeover bid for the business founded and run by the Irish entrepreneur, Aidan Heavey.

According to high street reports in London earlier this week, Hedge funds were aiming at shares in Tullow Oil,  as petroleum companies from emerging countries such as India and China rushed to secure future energy supplies.

Tullow’s shares last Monday rose from 0.57 per cent to 12.41 per cent, making a 48 per cent increase since March last year and giving the company a market value of £11 billion.

“Hedge funds are circling; there’s a rush to natural resources,” a Hedge fund manager was quoted by the Guardian London broadsheet last Tuesday as saying.

A hedge fund is a fund that can take both long and short positions, use arbitrage, buy and sell undervalued securities, trade options or bonds, and invest in almost any opportunity in any market where it foresees impressive gains at reduced risk.

Meanwhile, Millennium, which is US$7 billion under management, is believed to be one of the hedge funds that is in contact with Tullow. US fund manager Black Rock is the top shareholder with an 11.9 per cent.

“Tullows announcement provides further proof of the value in Ghana”, the Guardian reported analyst Peter Hitchens of stockbrokers and investment banking group, Panmure as saying.

Source: Graphic Business

Leave A Reply

Your email address will not be published.