Business Irish

Monday 25 September 2017

Petroceltic blasts 'laughable' EGM motions

Petroceltic operations in Algeria
Petroceltic operations in Algeria
Donal O'Donovan

Donal O'Donovan

The head of Petroceltic would rather be talking to potential merger partners than dealing with the "distraction" of an increasingly bitter shareholder row, he told the Irish Independent.

Oil and gas explorer Petroceltic issued a blistering response yesterday to calls by its biggest shareholder for a major shake up of the company - including the ousting of chief executive Brian O' Cathain.

"Don't let Worldview destroy your company," Petroceltic urged shareholders in a statement issued ahead of an extraordinary general meeting (EGM) on February 25.

Worldview, which owns 29pc of Petroceltic, demanded the EGM and is locked in an increasingly bitter row with the management.

Worldview wants shareholders to support motions, including to oust Brian O'Cathain.

It wants Maurice Dijols, an oil industry veteran, appointed as CEO and to have its own founder, Angelo Moskov, join Petroceltic's board as non-executive director.

It is also pushing for Petroceltic to adapt a new business strategy.

Yesterday, it an unusually blunt reply, Petroceltic accused Worldview of attempting a takeover of the business, and said the move could harm the business.

The Worldview proposals, if carried, would leave the Swiss investor a majority of board seats, and the board without independent financial expertise at director level, according to Mr O'Cathain.

"Worldview's attempt to take control of Petroceltic risks serious damage to the company's North African assets, and their proposed technical strategy for Algeria and Egypt is flawed," the company said.

A proposal to boost production is "technically unrealistic," according to the company statement.

Mr O'Cathain said Worldview's call to rapidly speed up development work in Algeria and boost production at its Egyptian wells was "laughable".

The ceo said he has the backing of the "vast majority of shareholders" he has spoken to, including Robert Adair who owns the second biggest stake.

But the scene is set for an EGM and the highly charged atmosphere could be complicated by a new takeover offer.

Dragon Oil dropped a €665m takeover bid for Petroceltic last year because of falling oil prices. Mr O'Cathain told the Irish Independent that Dragon could revive its merger plans, though the two sides are "not in discussions" today.

If Dragon Oil does not renew its approach merger activity in the sector is set to increased, and Petroceltic may be part of that, Brian O'Cathain said.

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