Trading in recently listed Diversified Gas & Oil (DGOC) has been suspended, after the low-cost US producer announced an $84.2m (£65.1m) deal to acquire some of Titan Energy's oil and gas assets. The deal, which if it completes will effectively double DGOC's market capitalisation, constitutes a reverse takeover under Aim rules.
IC TIP:
Buy
at
66p
The prize is a step change in reserves from 36.7m barrels of oil equivalent (mmboe) to 60.5mmboe, 7,300 additional producing wells, and an increase in net oil and gas production to 11,000boepd. The cost, to shareholders, at least, is a minimum $20m share placing and a three-year $110m debt facility "with a high single-digit interest rate".
