Genel Energy (LSE:GENL) shares climbed almost 7%, trading at 55.4p, after launching a recommended cash acquisition of Capricorn Energy.
It is to pay $3.75 per share, plus a $0.99 special dividend, with the combined value to Capricorn shareholders representing a total of $4.74 per share.
The deal brings Capricorn's Egyptian Western Desert portfolio into Genel's hands, adding onshore development and production assets that were consolidated into a single integrated licence in May 2025, ratified by Egyptian parliament in March, giving the enlarged group pro-forma proved and probable reserves of 117 million barrels of oil equivalent and combined December 2025 exit-rate production of 41,003 bopd, split evenly between Kurdistan and Egypt.
Genel's existing production at the Tawke PSC in Kurdistan averaged 17,520 bopd in 2025 at operating costs of approximately $4 per barrel, generating EBITDAX of $43 million for the year ended 31 December 2025.
"Today we announce a landmark transaction to acquire a leading oil and gas portfolio in Egypt, a move that delivers our strategic intent, reshapes our company's growth trajectory," said Paul Weir, chief executive of Genel.
The scheme requires Egyptian regulatory clearance, and completion is expected during the second half of 2026.
A transformational deal
Zeus Capital analyst Daniel Slater says the oil and gas producer's recommended cash bid for Capricorn Energy is the transformational deal Genel has been pursuing for several years.
Slater described the deal metrics as attractive and compelling (at $5.8 per 2P barrel of oil equivalent and an EV/EBITDA of 5.1x), as Zeus set a price target of 105p, implying some 94% upside.
