Genel Energy has agreed to buy Capricorn Energy (LSE:CNE) in an all-cash deal worth $360 million, sending shares in both companies sharply higher on Thursday.
Genel Energy (LSE:GENL) is acquiring Capricorn Energy in a recommended $360 million cash deal, valuing Capricorn shares at 357p each.
Capricorn shares were trading at 346p on Thursday, up 20.14% from Wednesday’s close of 288p, after touching an intraday high of 353p, above the stock’s previous 52-week high of 338.5p set in April. Genel shares were trading at 55p, up 6.18% from a previous close of 51.8p, within its 52-week range of 50.2p to 83.29p.
WELCOME BONUS - Free Share Bundle When You Invest £50!
Get up to £500 cashback for investing with IG.
Deal terms
Under the terms, Capricorn shareholders will receive $4.74 per share, comprising $3.75 in cash plus an intended special dividend of $0.99, according to Alliance News. The special dividend will only be paid if the scheme of arrangement under Part 26 of the Companies Act 2006, through which the deal is structured, becomes effective. That is expected in the second half of 2026. The transaction is being carried out via a newly formed vehicle, Genel Energy No.9 Limited.
Genel has already secured irrevocable undertakings covering just over 39% of Capricorn’s shares, including backing from Palliser Capital (UK) Ltd, Newtyn Management LLC, Kite Lake Capital Management (UK) LLP and Madison Avenue Partners LP, Alliance News reported. Genel said the deal creates an “independent energy company of scale” with a low-leverage balance sheet, and described Capricorn’s Egyptian Western Desert portfolio as an “attractive strategic pillar” for a business built around Kurdistan production.
The agreement comes a day after Capricorn extended, for a further time, the deadline for Alamadiyaf al-Masiyyah, part of the Cafani Group, to make a firm offer, after receiving what Capricorn described as multiple unsolicited non-binding proposals since March. That deadline was pushed to 29 July. Capricorn chief executive Randy Neely said the business “requires greater scale to materially improve trading liquidity,” adding: “We believe the transaction with Genel crystallises the value created by Capricorn while providing shareholders with a clear and efficient exit.”
Genel chief executive Paul Weir called the acquisition a “landmark” deal, saying it “delivers our strategic intent, reshapes our company’s growth trajectory, diversifies our portfolio of oil and gas fields and begins our role as a partner in Egypt’s energy future.” He added that the deal is expected to “realise accretive cash flow and returns over the coming years.”
Attention now turns to whether Cafani Group’s vehicle responds before its extended 29 July deadline, and to the shareholder and court approvals needed to complete the scheme. For Capricorn, a company that has weathered several unsuccessful M&A attempts in recent years, Thursday’s agreement offers what its own management calls a clear exit; for Genel, it marks a decisive step beyond Kurdistan and into Egypt.