Genel Energy has agreed to acquire Capricorn Energy in a recommended cash deal worth around £271m.

Edinburgh-based Carpricorn Energy is mainly Egypt‑focused, with the country acting as the centre of its production base, cash flow, and operational activity.

The combined company would create a larger Middle East and North Africa-focused oil and gas producer with operations spanning Egypt, the Kurdistan Region of Iraq, Oman and Somaliland.

Under the terms of the deal, the offer values Capricorn at £3.57 a share, representing a 34% premium to its closing share price before the offer period began and a 48% premium to its three-month volume-weighted average price.

Capricorn's latest reported revenues were $134m for FY2025.

Genel, based out of London, said the acquisition would diversify its production base by adding Capricorn's Egyptian Western Desert assets, creating a business with pro forma production of more than 41,000 barrels of oil per day (bopd) and 2P reserves (the industry’s core measure of proven and probable oil and gas reserves) of 117 million barrels of oil equivalent.

The enlarged group is also expected to benefit from stronger cash generation and additional growth opportunities across the MENA region.

“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, diversifies our portfolio of oil and gas fields and begins our role as a partner in Egypt’s energy future," said Genel CEO Paul Weir.

Weir said: "By applying our technical and operational capabilities to these assets, we will work with the operator to accelerate production optimisation, replace reserves, reduce unit costs, and capture significant near‑term cash flow while preserving optionality for future development. For our shareholders, the acquisition is expected to realise accretive cash flow and returns over the coming years."

Capricorn CEO Randy Neely, added: "Capricorn requires greater scale to materially improve trading liquidity. We believe the transaction with Genel crystallises the value created by Capricorn while providing shareholders with a clear and efficient exit."

The news triggered a big jump in trading, with Capricorn shares rising around 20% and Genel shares gaining about 7% following the announcement.

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