January 29, 2020 / 9:36 AM / 19 days ago

Africa-focused Tullow largest investor builds stake

Jan 29 (Reuters) - Tullow Oil’s largest investor and West African oil tycoon Samuel Dossou-Aworet increased his stake in the London-listed firm to almost 10%, raising the possibility of a takeover bid.

Samuel Dossou-Aworet, who also founded Geneva-headquartered Petrolin, on Jan. 24 raised his stake in Africa-focused Tullow to 9.67% from an earlier stake on 7.06%, a filing showed.

Benin-native Dossou-Aworet co-founded Energy Africa, an exploration business that Tullow bought in 2004, helping Tullow double in size.

His latest stake buy comes after a tumultuous period for Tullow. Tullow shares had fallen nearly 65% in 2019 and nearly 16% this year.

The company’s shares were 1.5% higher at 53.9 pence at 0846 GMT.

The Times reported on Wednesday that there would be a “lowball bid” for Tullow, citing one investor.

Tullow said this month that it would take a $1.5 billion writedown after cutting its long-term oil price assumptions by $10 to $65 a barrel, a downgrade to reserves in Ghana and disappointing exploration wells.

The writedown at Tullow comes after the exit of chief executive officer Paul McDade in December and the scrapping of the group’s dividend after the company failed to meet production targets due to a weak performance at its assets in Ghana.

Tullow has also suffered as oil prices were volatile in 2019 on the back of global trade disputes, which have bruised some of the world’s biggest economies, and ongoing supply cuts from major oil producers. (Reporting by Noor Zainab Hussain in Bengaluru; Editing by Bernard Orr)

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