By Bryce Elder
Published: February 23 2011 19:39 | Last updated: February 23 2011 19:39
Bowleven rose 3.2 per cent to 323p after Goldman Sachs added the oil explorer to its “conviction buy” list on valuation grounds. Investors were putting no value to Bowleven’s drilling campaign due to start at the Etinde field offshore Cameroon, even though success had the potential to lift the stock above £10, the broker said.
Encore Oil was up by 3.7 per cent to 120½p following press speculation that Premier Oil would agree a bid of around 220p per share for its North Sea peer before May.
“First up, it would be bizarre, in our view, if two companies had agreed a price for a deal and then waited for up to two months to announce it,” said RBS analyst Phil Corbett, who also doubted whether Encore’s exploration portfolio would be of interest to Premier. “Given the market tends to place much greater value on exploration than the industry, and Premier’s only major foray into corporate acquisitions in recent years was through the distressed sale of Oilexco, we would discount these reports for now,” he said.
Source: http://www.ft.com/cms/s/0/eb2119da-3f7e-11e0-a1ba-00144feabdc0.html#axzz1ErFqLn2A
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