DNO has agreed terms to acquire Capricorn Energy (LSE:CNE), the Egypt-focused oil and gas company, in a recommended cash deal valuing the entire issued share capital at approximately $396 million.
It's a transaction that potentially heats up the bid situation around Genel, which DNO recently bid for, and was the previous recommended acquirer of Capricorn.
In the new DNO deal, Capricorn shareholders will receive $5.214 per share, made up of a $4.224 cash payment plus a $0.99 special dividend expected before completion. That total represents a 45% premium to Capricorn's undisturbed share price of 266p on 10 March, and beats the rival Genel Energy offer by around 10%, or $0.474 a share.
The improved terms automatically lapsed irrevocable undertakings that non-director shareholders had given in support of the Genel deal, though director Randy Neely's undertaking to back Genel remains binding, meaning he must vote against the DNO scheme unless it lapses. Similarly, Capricorn's board, advised by Canaccord Genuity, now intends to unanimously recommend the DNO acquisition.
For DNO, the deal marks its entry into Egypt, adding a third core operating area alongside its existing North Sea and Kurdistan Region of Iraq businesses.
"Capricorn will add another business with scale, cashflow and growability to our existing operations," said Bijan Mossavar-Rahmani, DNO's executive chairman, adding the company plans further investment and acquisitions in Egypt.
Randy Neely, Capricorn's chief executive, said the offer "maximises the value created by the Capricorn team".
The deal remains subject to regulatory consent and shareholder approval, with completion pencilled in for the fourth quarter of 2026 or first quarter of 2027.
News Intelligence what this means for the company
DNO has secured Capricorn Energy's board recommendation with a $5.214-per-share cash offer ($396m total), beating Genel Energy's rival bid by roughly 10% and representing a 45% premium to Capricorn's pre-auction price. The deal gives DNO entry into Egypt's Western Desert, where Capricorn generated $134m in revenue in FY 2025 and produces ~20,000 boe/d, adding to DNO's North Sea and Kurdistan operations; completion hinges on Egyptian regulatory approval and shareholder vote, expected Q4 2026 or Q1 2027.
- Genel Energy's rival bid has been displaced; the outcome of Genel's response (if any) remains open.
- Director Randy Neely's binding undertaking to Genel means he must vote against the DNO scheme unless that undertaking lapses, creating a potential governance friction point ahead of the shareholder vote.
For Capricorn shareholders, the deal closes a 15-month auction process at a material premium; the $396m valuation reflects Capricorn's cash-generative Egyptian portfolio and $103m net cash position. Execution risk centres on Egyptian regulatory consent and the Q4 2026–Q1 2027 completion window.
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