Candover trumps Halliburton Expro bid

Halliburton is mulling a counterbid as Expro’s share price jumped well above Candover’s £1.75bn agreed offer.

The bidding war for Expro, a FTSE 250 oil and gas services company, stepped up a gear today as a Candover consortium trumped a £1.705 billion bid from Halliburton, the oil giant.

There’s potential for very significant revenue and cost-saving synergies for Halliburton. We are continuing to monitor the situation. It’s an attractive business which is growing fast from our point of view.

Halliburton's spokesman

The Candover consortium’s latest recommended offer for Expro is approximately £1.75 billion or £15.50 per share.

Should it succeed the European buyout firm will take a more than 40 percent stake in Expro. Goldman Sachs Capital Partners, the captive arm of the investment bank, will take a similar stake, and AlpInvest Partners, the Dutch investment firm, is looking to acquire the remainder.

Expro measures, improves, controls and processes the flow of oil and gas wells.

The public markets are pricing in a counterbid, with Expro shares trading at £16.26 per share. This is despite a near 68 percent premium to Expro’s closing price of £9.26 per share on 28 February 2008, the day before the FTSE 250 company said it had received an offer.

Halliburton’s spokesman said the oil giant would not necessarily make a counteroffer, but it was “thinking” about doing so. “There’s potential for very significant revenue and cost-saving synergies for Halliburton. We are continuing to monitor the situation. It’s an attractive business which is growing fast from our point of view,” he said.

Earlier today, a statement was issued by Expro saying Halliburton made an indicative offer for Expro, a FTSE 250 oil and gas distribution company, which was higher than Candover’s previous £1.605 billion agreed bid for the company. The oil giant had said it was prepared to pay around £1.705 billion, according to a statement.

The offer by Candover needs 75 percent acceptance from shareholder by the date of a shareholder meeting on 2 June.

Halliburton has been in due diligence with Expro since Candover agreed its £14.35 per share bid for the company.

The Candover consortium has assembled a large syndicate of banks to support its bid. RBS, Lloyds TSB, HSBC, HBoS, DNB Nor, the Norwegian financial services group and the Royal Bank of Canada, which provided slightly less than £1 billion in debt, according to Candover.

Last year Candover managed to secure victory in one of the more competitive bidding wars for a listed company since the credit crunch began. It eventually managed to buy Stork, the Dutch conglomerate, for €1.5 billion ($2.4 billion) by partnering with a consortium of Icelandic rival bidders, which had built up a blocking stake in the company.