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Cairn Energy makes £280.7 million acquisition


FTSE250 company buys Agora Oil & Gas

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Oil explorer Cairn Energy agreed a £280.7 million to buy Agora Oil & Gas, it announced on Tuesday.

The FTSE250 company bought Agora in an attempt to increase its drilling activity in the UK and Norway.

Cairn said it would pay for the deal through a combination of approximately 43 percent cash and 57 percent Cairn shares, subject to regulatory approval.

The energy company said it would pay a total consideration of £280.7 million when including the net working capital of £46.8 million. It put the enterprise value of the proposed acquisition at £234 million, including £36.1 million of potential tax shelter in Britain and Norway.

"This is an important first step in establishing balance in the Cairn portfolio," chief executive Simon Thomson said. "This acquisition secures a building block in areas where we see the opportunity to build cash flow from near term, lower risk exploration, development or producing properties.

"Agora possesses attractive core assets and significant exploration potential both in 2012 and beyond in an area offering future organic growth."

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Cairn Energy makes £280.7 million acquisition
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