Norwegian oil and gas firm DNO has made a takeover bid to acquire all of the issued and to-be-issued share capital of Faroe Petroleum for a £607.9m ($778.5m) consideration.

The company already owns 105,247,866 shares in Faroe, which represents 28.22% of the company’s issued share capital.

According to the proposal, DNO will offer 152 pence in exchange for each Faroe share.

DNO first acquired shares in the UK company in April. Since then, speculations were rife that the company would launch an acquisition bid for Faroe.

“We attach great importance to retaining the skills, knowledge and expertise of Faroe’s operational management and employees.”

DNO executive chairman Bijan Mossavar-Rahmani said: “We firmly believe that Faroe’s assets, the substantial part of which are Norwegian, are better placed in the bosom of DNO, Norway’s oldest independent oil and gas company, currently operating gross production of 125,000 barrels per day which compares with the 7,500 barrels of oil equivalent a day of gross production operated by Faroe. DNO’s proven and probable reserves were nearly four times those of Faroe’s as reported at 31 December 2017.

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“Whether the offer achieves DNO’s minimum acquisition target or the acquisition of all of Faroe’s shares, we attach great importance to retaining the skills, knowledge and expertise of Faroe’s operational management and employees. We intend to retain Faroe’s Aberdeen head office and each of the other offices.”

Responding to the proposal, Faroe stated that it was not consulted before the offer was made public.

The company added that its board will consider the offer and announce the decision until which shareholders have been advised to take no action.

Earlier this month, Faroe reported a successful result with the Agar/Plantain exploration and appraisal well in licence P1763 in the UK Continental Shelf. The operator Azinor Catalyst made an oil discovery estimated to contain recoverable resources ranging between 15 and 50 million barrels of oil equivalent (Mboe).

DNO’s asset base is mainly located in the Middle East with focus on Iraqi Kurdistan. The company returned to the North Sea last year to pursue business expansion through acquisitions and other investments, Reuters reported.