Caithness in ‘review of options’ that hints at plans for flotation

By GARETH MACKIE
Published on 05/07/2012 00:00

NORTH Sea oil firm Caithness Petroleum has resurrected hopes of a possible flotation after appointing Bank of America Merrill Lynch and Morgan Stanley to review its strategic options.

Although one such option could be an initial public offering (IPO), insiders said talk of an imminent flotation was premature, and the firm distanced itself from speculation that it could be valued at up to £400 million.

Last month it emerged that Aberdeen-based Eland Oil & Gas is also looking to raise more than £100m through a float on the Alternative Investment Market (Aim) to fund a major acquisition in Nigeria.

Although there have not been any Scottish Aim flotations so far this year, the last two firms to join – Edinburgh-based internet dating specialist Cupid and Glasgow-based gas meter group Smart Metering Systems – have both seen significant rises in their market value.

Caithness operates in the Moray Firth and has other interests in Morocco and Texas. The privately-owned firm is chaired by David Donnelly, a former chief executive of the private equity arm of wealth manager Fleming Family & Partners.

Last year Caithness appointed Shell veteran Yves Merer as chief executive, replacing Robert Kennedy, who founded the firm in 2006. Kennedy, who previously ran Aim-quoted Anglo Siberian Oil before its acquisition by Russian state-owned energy giant Rosneft in 2003, remains as commercial director and is a major shareholder.

The firm had considered a possible IPO in the third quarter of last year to raise funds for a drilling programme in Morocco, but only if market conditions were “favourable”.