Savanna Energy Services Corp said on Thursday it had received interest from other potential bidders after fellow oilfield services provider Total Energy Services Inc went hostile with its offer to buy the company.
Calgary-based Savanna, whose shares rose as much as 10.5 percent to $2.00 in morning trading, said it would explore strategic alternatives early next year.
The company first made a proposal to buy Savanna in November, offering 0.1132 of its shares for each Savanna share.
Total Energy, which is also based in Calgary, raised its offer to 0.1300 of its shares earlier this month and took it directly to Savanna’s shareholders. Savanna said on Monday it would review the latest unsolicited bid.
Savanna Energy had a market value of about $190 million (US$143 million) as of Wednesday’s close, while Total Energy was valued at about $435 million.
A more than 50 percent fall in oil prices since mid-2014 eroded demand for services provided by oilfield companies, setting off a wave of consolidation.
U.S. driller Patterson-UTI Energy Inc said on Monday it would buy Seventy Seven Energy Inc in an all-stock deal worth US$1.76 billion including debt.
Up to Wednesday’s close, Savanna’s stock had risen 23 percent since Total Energy’s initial bid.
Update: Last month, Alberta Investment Management Corp (AIMCo) agreed to provide Savanna with about $219 million in debt and equity financing. The pension fund indicated it is opposed to the company’s acquisition by Total Energy.
(Reporting by Ahmed Farhatha in Bengaluru; Editing by Saumyadeb Chakrabarty and Ted Kerr)
(This story has been edited by Kirk Falconer, editor of PE Hub Canada)
Photo courtesy of Savanna Energy Services Corp