from Genel Energy (isin : JE00B55Q3P39)
Genel Energy PLC: INCREASED RECOMMENDED CASH OFFER for Capricorn Energy plc (“Capricorn”) by Genel Energy No.9 Limited
Genel Energy PLC (GENL, CNE) NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR FROM CANADA, AUSTRALIA, JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR IMMEDIATE RELEASE 25 September 2026 INCREASED RECOMMENDED CASH OFFER for Capricorn Energy plc (“Capricorn”) by Genel Energy No.9 Limited (“Bidco”) (a company indirectly owned by Genel Energy plc (“Genel”)) to be effected by means of a scheme of arrangement under Part 26 of the Companies Act 2006
The boards of Genel, Bidco and Capricorn are pleased to announce that they have reached agreement on the terms of an increased recommended cash offer (the “Increased Offer”) under which Bidco will acquire the entire issued and to be issued ordinary share capital of Capricorn (the “Genel Acquisition”). The Increased Offer is to be effected by means of a Scottish scheme of arrangement under Part 26 of the Companies Act 2006 (the "Scheme"). Under the terms of the Increased Offer, each Capricorn Shareholder shall be entitled to receive, in aggregate: US$5.74 in cash for each Capricorn Share held (the “Increased Acquisition Value”) The Increased Acquisition Value comprises, for each Capricorn Share:
The Sterling equivalent value of the Increased Acquisition Value, being 434 pence per Capricorn Share based on the Increased Offer Announcement Exchange Rate (as defined in Appendix I), represents a premium of approximately:
The Increased Acquisition Value also provides Capricorn Shareholders with superior value to the offer initially announced by DNO Bidco AS (“DNO Bidco”) on 1 September 2026 and revised on 17 September 2026 (the “DNO Offer”), as the Increased Acquisition Value represents:
The Increased Acquisition Value (assuming the Permitted Dividend is declared and paid in full) implies a value for the entire issued and to be issued ordinary share capital of Capricorn of approximately US$436 million on a fully diluted basis, which is equivalent to £330 million based on the Increased Offer Announcement Exchange Rate (as defined in Appendix I). The Increased Acquisition Price payable under the Increased Offer is expressed in US$. The US$ denominated Increased Acquisition Price reflects the underlying characteristics of Capricorn’s business activities, which are largely denominated in US$. If, on or after the date of this announcement and prior to the Effective Date, any dividend, distribution, or other return of value or excess is declared, made, or paid or becomes payable by Capricorn (other than, or in excess of the amount of, the Permitted Dividend), Bidco reserves the right to reduce the Increased Acquisition Price payable under the terms of the Increased Offer for the Capricorn Shares by an amount equal to the amount of any such dividend, distribution or other return of value or excess. In such circumstances, the Capricorn Shareholders shall be entitled to retain any such dividend, distribution, or other return of value declared, made, or paid. Details of the initial offer by Bidco for Capricorn which was recommended by the Capricorn Directors (the “Initial Offer”) were set out in the firm offer announcement dated 2 July 2026 (the “Announcement”) and the scheme document published on 21 July 2026 (the “Scheme Document”). This announcement should be read in conjunction with the Scheme Document. The Genel Acquisition received the support of in excess of 99 per cent. of the Capricorn Shares voted (whether in person or by proxy) at the Court Meeting and the General Meeting which took place on 18 August 2026 (an announcement in respect of which was made by Capricorn on 18 August 2026). The boards of Genel, Bidco and Capricorn also confirm that the Egyptian Competition Authority approved the Genel Acquisition on 7 September 2026, meaning that the Egyptian Merger Condition has been satisfied. This leaves the Egyptian Condition as the only outstanding regulatory condition as at the date of this announcement. Capricorn (in co-operation with Genel and Bidco) has had several constructive discussions with the Egyptian Government and made significant progress towards satisfying the Egyptian Condition since the Announcement. Genel wishes to take this opportunity to thank the Egyptian Government for its collaborative approach to these discussions to date. In light of this positive engagement, the boards of Genel and Bidco continue to expect that the Egyptian Condition will be satisfied in accordance with the expected timetable set out in the Announcement and continue to expect that the Scheme shall become Effective during the fourth quarter of 2026.
On 1 September 2026, the boards of DNO ASA (“DNO”), DNO Bidco and Capricorn announced the DNO Offer to acquire the entire issued and to be issued share capital of Capricorn. On 17 September 2026, the boards of DNO, DNO Bidco and Capricorn announced a revision to the DNO Offer. Following the announcement of the revision of the DNO Offer on 17 September 2026, Genel approached Capricorn with an increased proposal at the Increased Acquisition Value, representing a premium of approximately 10 per cent. to the DNO Offer Acquisition Value. Following discussions, the board of directors of each of Genel, Bidco and Capricorn have agreed the terms of an increased recommended offer by Bidco for the entire issued and to be issued share capital of Capricorn.
Prior to the Announcement, Bidco received an irrevocable undertaking from the Capricorn Director who holds Capricorn Shares, as set out in the Scheme Document, which remains binding in relation to the Increased Offer. Bidco has also received revised irrevocable undertakings from Palliser Capital (UK) Ltd, Newtyn Management, LLC, Kite Lake Capital Management (UK) LLP (“Kite Lake”), and Madison Avenue Partners, LP (“Madison Avenue”) (together, the “Irrevocable Shareholders”) to vote (or procure the voting) against and/or not accept (or procure the non-acceptance of) any offer other than the Genel Acquisition in respect of a total of 27,903,950 Capricorn Shares representing, in aggregate, approximately 39.1 per cent. of Capricorn’s share capital in issue on 24 September 2026, being the last Business Day prior to the date of this announcement (the “Revised Irrevocable Undertakings”). The Revised Irrevocable Undertakings prevent such Capricorn Shareholders from selling all or any part of their Capricorn Shares. The irrevocable undertaking from the Capricorn Director who holds Capricorn Shares remains binding in the event that a higher competing offer is made for Capricorn, whilst the Revised Irrevocable Undertakings remain binding in the event a higher competing offer is made unless the competing offer represents an improvement of 10 per cent. or greater in respect of the Increased Acquisition Value (including the Permitted Dividend). Bidco has therefore received irrevocable undertakings in respect of a total of 27,908,345 Capricorn Shares representing, in aggregate, approximately 39.1 per cent. of Capricorn’s issued share capital. Further details of the Revised Irrevocable Undertakings, including the circumstances in which they shall cease to be binding, are set out in Appendix II to this announcement.
The Capricorn Directors, who have been so advised by Canaccord Genuity as to the financial terms of the Increased Offer, consider the terms of the Increased Offer to be fair and reasonable. In providing its advice to the Capricorn Directors, Canaccord Genuity has taken into account the commercial assessments of the Capricorn Directors. Canaccord Genuity is providing independent financial advice to the Capricorn Directors for the purposes of Rule 3 of the Code. The Capricorn Directors’ recommendation of the DNO Offer has accordingly been withdrawn with immediate effect in favour of implementing the Increased Offer. Although the DNO Offer has not lapsed as a result of this announcement, in light of the Increased Offer from Bidco, the Capricorn Directors intend to adjourn the court meeting and the general meeting in connection with the DNO Offer convened for 1.00 p.m. and 1.15 p.m., respectively on 16 October 2026. A further announcement will be made by Capricorn in this regard in due course. It is therefore recommended that Capricorn Shareholders take no further action in relation to the DNO Offer. Capricorn Shareholders should note the following factors in connection with the Increased Offer:
Given the above, the Capricorn Directors believe that the Increased Offer provides Capricorn Shareholders with superior value, certainty and deliverability relative to the DNO Offer.
Bidco Bidco is a limited company registered in England and Wales and incorporated on 19 May 2026. Bidco is a wholly owned indirect subsidiary of Genel. Bidco was formed for the purposes of the Genel Acquisition and has not traded since its date of incorporation, nor has it entered into any obligations other than in connection with the Genel Acquisition and the Increased Offer. Genel Genel is a socially responsible oil producer, with a portfolio of production and exploration assets, including production assets in the Kurdistan Region of Iraq and exploration licences in Oman and Somaliland. Genel's strategy comprises three objectives designed to build a business with resilient and diversified cash flows that deliver sustainable value to shareholders, and with the aim of restarting the payment of a regular dividend: (i) a strong balance sheet; (ii) diversified and resilient cash generation; and (iii) investment in new cash flows. The Genel business is a resilient, cash-generative platform with significant unvalued potential. For the financial year ended 31 December 2025, Genel generated 17,520 bopd in working interest production, with an EBITDAX of US$43 million (2024: US$1 million). Genel Shares are listed on the Official List maintained by the Financial Conduct Authority (the "Official List") and admitted to trading on the Main Market of the London Stock Exchange. On 20 August 2026, Genel announced that, in connection with the Genel Acquisition, it had requested to transfer the listing category of all of its ordinary shares of 10 pence each from the equity shares (transition) category of the Official List to the equity shares (commercial companies) category of the Official List, in accordance with the UK Listing Rules (the “Transfer”). The Transfer is subject to, amongst other things, the completion of the Genel Acquisition. Further announcements will be made in due course regarding the timetable and the expected date that the Transfer will take effect.
Capricorn, a Scottish public limited company headquartered in Edinburgh, is an independent energy company which has been listed on the Main Market of the London Stock Exchange for more than 30 years. Capricorn’s recent presence in the North Sea focused around significant exploration activity and the development of two material development projects, being Catcher and Kraken, which both began production in 2017. These interests were subsequently sold in November 2021. Capricorn continued to maintain its business in the UK North Sea, through the drilling of the Jaws and Diadem exploration wells in 2022, and since then has focused on business development activities in the region. Currently, Capricorn’s core operations are in Egypt’s Western Desert, where it holds a portfolio of onshore development and production assets. In May 2025, Capricorn agreed with EGPC to consolidate eight of its 50:50 jointly owned concessions into a single, integrated licence with enhanced commercial terms, providing a platform for future growth. On 30 March 2026, Capricorn announced that it had received formal parliamentary ratification of this agreement. In addition to maximising value from its assets in Egypt, from 2023 onwards Capricorn has been focused on streamlining operations, reducing costs and has returned around $600 million to shareholders.
It is proposed to implement the Increased Offer by way of amending the Scheme. Further information relating to the implementation of the Increased Offer, including details of any further meetings of the Capricorn Shareholders in connection with the Scheme (if required) and the date of the Sanction Hearing (once set) will be announced through a Regulatory Information Service. Save as disclosed in this announcement, the Increased Offer will be subject to the terms and conditions set out in Part 4 of the Scheme Document with:
Bidco is providing the cash consideration payable under the Increased Offer together with certain fees and expenses in connection with the Increased Offer, through a combination of its own existing cash resources and new debt financing. A summary of the terms of the new debt financing is contained in Appendix III. PJT Partners, as financial adviser to Bidco, is satisfied that sufficient resources are available to Bidco to satisfy in full the Increased Acquisition Price payable to Capricorn Shareholders pursuant to the terms of the Genel Acquisition. PJT Partners has not been required to confirm, and has not confirmed, that resources are available to Capricorn to satisfy payments to Capricorn Shareholders pursuant to the Permitted Dividend. Further details of the Permitted Dividend, including the risks to Capricorn Shareholders if, for any reason, the payment obligations pursuant to the Permitted Dividend are unable to be satisfied by Capricorn, are set out below and in paragraph 9 of Part 1 of the Scheme Document.
Consistent with the Initial Offer, the Increased Offer contemplates, and the boards of Genel, Bidco and Capricorn have agreed to, the declaration and payment of the Permitted Dividend. The Permitted Dividend represents the same value to Capricorn Shareholders as the dividend permitted under the terms of the Initial Offer. Whilst payment of the Permitted Dividend will be subject to compliance with applicable statutory requirements at the relevant time, prior to the Announcement, the Capricorn Board concluded that in all reasonable circumstances Capricorn would have available to it sufficient cash resources to pay the Permitted Dividend in full. The Capricorn Board has updated that analysis prior to the date of this announcement and has again concluded that in all reasonable circumstances it will have available to it sufficient cash resources to pay the Permitted Dividend in full. Further details of the Permitted Dividend, including in respect of the ability of the Capricorn Board lawfully to declare and pay the Permitted Dividend, are set out in paragraph 9 of Part 1 of the Scheme Document.
The expected timetable of principal events for the implementation of the Scheme (as amended) remains as set out on page 10 of the Scheme Document. If any of the dates and/or times in the expected timetable change, the revised dates and/or times will be notified by announcement through a Regulatory Information Service. Subject to the satisfaction (or where applicable, waiver) of the Conditions, the Scheme is expected to become Effective during the fourth quarter of 2026. The Increased Offer does not change Bidco’s intentions as regards the business of Capricorn (including locations of its operations), the management and employees of Capricorn and the proposals in respect of the Capricorn Share Plans, as set out in the Scheme Document and in the letters already sent to the participants in the Capricorn Share Plans informing them of the effect of the Scheme on their rights under the Capricorn Share Plans and, where applicable, containing appropriate proposals in respect of such rights. The views of the Capricorn Board on the stated intentions of Genel and Bidco set out in the Scheme Document also remain unchanged. Bidco has agreed to waive any right it may have to terminate the Co-operation Agreement as a result of the announcements in relation to the DNO Offer on 1 September 2026 and 17 September 2026 respectively pursuant to a side letter dated on or around the date of this announcement (the “Co-operation Agreement Side Letter”). Genel and Bidco confirm that:
Capitalised terms in this announcement, unless otherwise defined have the same meanings as set out in the Scheme Document.
Copies of the following documents shall be made available on Genel’s and Capricorn’s websites at https://genelenergy.com/offer/ and https://www.capricornenergy.com/investors/ respectively until the Effective Date:
Enquiries:
Linklaters LLP are retained as legal advisers to Genel and Bidco. Ashurst Perkins Coie UK LLP are retained as legal advisers to Capricorn.
Inside Information The information contained within this announcement is deemed by Genel and Capricorn to constitute inside information as stipulated under the Market Abuse Regulation (EU) no. 596/2014 (as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018). On the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain. The person responsible for arranging the release of this announcement on behalf of Genel is Chandni Karania, Company Secretary and on behalf of Capricorn is Paul Ervine, Company Secretary. Important Notices PJT Partners (UK) Limited (“PJT Partners”), which is authorised and regulated by the Financial Conduct Authority in the United Kingdom, is acting exclusively as financial adviser to Bidco and Genel and no one else in connection with the Increased Offer and will not be responsible to anyone other than Bidco and Genel for providing the protections afforded to clients of PJT Partners nor for providing advice in connection with the Increased Offer. Neither PJT Partners nor any of its subsidiaries, branches or affiliates nor any of their respective directors, officers, employees, agents or representatives owes or accepts any duty, liability or responsibility (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of PJT Partners in connection with the Increased Offer, any statement contained herein or otherwise. Canaccord Genuity, which is authorised and regulated by the Financial Conduct Authority in the United Kingdom, is acting exclusively as financial adviser and Rule 3 adviser to Capricorn and no one else in connection with the Increased Offer and will not be responsible to anyone other than Capricorn for providing the protections afforded to clients of Canaccord Genuity nor for providing advice in relation to the Increased Offer or any other matters referred to in this announcement. Neither Canaccord Genuity nor any of its affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Canaccord Genuity in connection with this announcement, any statement contained herein or otherwise. Moelis, which is regulated by the Financial Conduct Authority in the United Kingdom, is acting exclusively as financial adviser to Capricorn and no one else in connection with the Increased Offer and other matters set out in this announcement and will not be responsible to anyone other than Capricorn for providing the protections afforded to clients of Moelis, or for providing advice in connection with the Increased Offer or any matter referred to herein. Neither Moelis nor any of its affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Moelis in connection with this announcement, any statement contained herein or otherwise. This announcement is for information purposes only and does not constitute an offer to sell or an invitation to purchase any securities or the solicitation of an offer to buy any securities, pursuant to the Increased Offer or otherwise. This announcement has been prepared for the purpose of complying with English law, Scots law and the Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions outside England and Wales, and Scotland. This announcement does not constitute a prospectus or prospectus exemption document. Overseas Shareholders The release, publication or distribution of this announcement in or into certain jurisdictions other than the United Kingdom may be restricted by law. Persons who are not resident in the United Kingdom or who are subject to other jurisdictions should inform themselves of, and observe, any applicable requirements. Unless otherwise determined by Bidco or required by the Code, and permitted by applicable law and regulation, the Increased Offer shall not be made available, directly or indirectly, in, into or from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction and no person may vote in favour of the Increased Offer by any such use, means, instrumentality or form within a Restricted Jurisdiction or any other jurisdiction if to do so would constitute a violation of the laws of that jurisdiction. Accordingly, copies of this announcement and all documents relating to the Increased Offer are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in, into or from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction, and persons receiving this announcement and all documents relating to the Increased Offer (including custodians, nominees and trustees) must not mail or otherwise distribute or send them in, into or from such jurisdictions where to do so would violate the laws in that jurisdiction. The availability of the Increased Offer to Capricorn Shareholders who are not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions in which they are resident. Persons who are not resident in the United Kingdom should inform themselves of, and observe, any applicable requirements. The Increased Offer shall be subject to the applicable requirements of the Code, the Panel, the London Stock Exchange and the Financial Conduct Authority. Additional information for US investors The Increased Offer relates to shares of a Scottish company listed on the Official List of the London Stock Exchange and is proposed to be effected by means of a scheme of arrangement under Scots law. A transaction effected by means of a scheme of arrangement is not subject to the tender offer rules or the proxy solicitation rules under the US Exchange Act. Accordingly, the Increased Offer is subject to the disclosure and procedural requirements applicable in the United Kingdom to schemes of arrangement which differ from the disclosure and procedural requirements of United States tender offer and proxy solicitation rules. However, if in the future Bidco were to elect to implement the Increased Offer by means of a takeover offer, such takeover offer would be made in compliance with all applicable United States laws and regulations, including, without limitation, to the extent applicable and subject to any applicable exemptions, Section 14(e) of the US Exchange Act and Regulation 14E thereunder. Such a takeover would be made in the United States by Bidco and no one else. In accordance with normal United Kingdom practice, Bidco or its nominees, or its brokers (acting as agents), may from time to time make certain purchases of, or arrangements to purchase, shares or other securities of Capricorn outside the US, other than pursuant to the Increased Offer, until the date on which the Increased Offer and/or the Scheme becomes Effective, lapses or is otherwise withdrawn. These purchases may occur either in the open market at prevailing prices or in private transactions at negotiated prices. Any information about such purchases or arrangements to purchase shall be disclosed as required in the UK, shall be reported to a Regulatory Information Service and shall be available on the London Stock Exchange website at www.londonstockexchange.com. The receipt of consideration by a US holder for the transfer of its Capricorn Shares pursuant to the Scheme shall be a taxable transaction for United States federal income tax purposes. Each Capricorn Shareholder is urged to consult their independent professional adviser immediately regarding the tax consequences of the Increased Offer applicable to them, including under applicable United States federal, state and local, as well as overseas and other, tax laws. Financial information relating to Capricorn included in this announcement and the Scheme Document has been or shall have been prepared in accordance with accounting standards applicable in the United Kingdom and may not be comparable to financial information of US companies or companies whose financial statements are prepared in accordance with generally accepted accounting principles in the United States ("US GAAP"). US GAAP differs in certain significant respects from accounting standards applicable in the United Kingdom. None of the financial information in this announcement has been audited in accordance with auditing standards generally accepted in the United States or the auditing standards of the Public Company Accounting Oversight Board (United States). Bidco is organised under the laws of England and Wales and Capricorn is organised under Scots law. Some or all of the officers and directors of Bidco and Capricorn, respectively, are residents of countries other than the United States. In addition, most of the assets of Bidco and Capricorn are located outside the United States. As a result, it may be difficult for US shareholders of Capricorn to effect service of process within the United States upon Bidco or Capricorn or their respective officers or directors or to enforce against them a judgment of a US court predicated upon the federal or state securities laws of the United States, including judgments based upon the civil liability provisions of the US federal securities laws. US holders of Capricorn Shares may not be able to sue a non-US company or its officers or directors in a non-US court for violations of US securities laws. Further, it may be difficult to compel a non-US company and its affiliates to subject themselves to a US court's jurisdiction or judgment. Forward looking statements This announcement (including information incorporated by reference in this announcement), oral statements made regarding the Increased Offer, and other information published by Capricorn, Bidco or any member of the Genel Group contain statements which are, or may be deemed to be, “forward looking statements”. Such forward looking statements are prospective in nature and are not based |