Teeling faces fight for control of Pan Andean
Ciaran Hancock
PAN ANDEAN RESOURCES, an exploration and production company founded by the Irish entrepreneur John Teeling, looks set to be the subject of a takeover battle next year. The Northern Ireland investor Tommy O’Gorman is preparing to wrest control of the underperforming stock from Teeling, who spent €1m earlier this month in a defensive move that took his shareholding to about 4.7%.
O’Gorman owns about 4% of Pan Andean, but is believed to have the support of other shareholders who between them own 10% or more of the stock. The Newry-based investor, who owns a large portfolio of resource shares, is thought to have spent about €1m buying his stock in Pan Andean, whose share price of 13p is near an all-time low.
He said he was unhappy with the performance of the company and was prepared to take action. “It is significantly undervalued in relation to its peers in the sector and, if the present management can’t realise that value, then I will seek the support of other shareholders to replace the board.”
Teeling, however, said he had no intention of surrendering control of the company he set up in 1988. “We have not delivered on the value in the company, I would be the first to accept that,” he said, “but I’ve put my money where my mouth is and I’m confident of delivering value to shareholders over the next 12 months.”
Pan Andean is one of a number of companies set up and run by Teeling from his base in Clontarf, north Dublin. He, his family and other directors control about 15% of Pan Andean’s equity. A series of setbacks has knocked investor confidence in the company, whose shares were valued as high as 139p in the 1990s.
It has oil-producing assets in the Gulf of Mexico and Bolivia. It also has about $7m in cash on its balance sheet and prospects in onshore and offshore Texas, in South America and is pursuing opportunities in the Middle East.
O’Gorman will not find it easy to take control of Pan Andean given that it has about 7,000 shareholders.
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