Ophir Energy has assets in south-east Asia. Credit: Jonathan Cutrer.

UK’s oil and gas exploration and production company Ophir Energy has rejected a potential £340m ($437m) buyout offer made by Indonesian oil and gas group Medco Energi Global.

Last October, Medco made an unsolicited approach to acquire the entire issued and to be issued share capital of Ophir at an offer price of 58p for each Ophir ordinary share.

Holding assets in south-east Asia, Ophir said that it has rejected Medco’s potential buyout offer, saying it ‘undervalues’ the UK energy company.

Medco Energi Global is a wholly owned subsidiary of Medco Energi Internasional.

“Under takeover rules in the UK, Medco Energi Global can make a firm offer or walk away by 28 January.”

Ophir said in a statement: “The board of Ophir has now met formally to consider the possible offer announced by Medco on 11 January 2019 to acquire the issued and to be issued share capital of Ophir at an offer price of 48.5 pence per Ophir ordinary share.

“The board has unanimously rejected the proposal as it undervalues Ophir. On 15 January 2019, Ophir will provide an update on its trading and operations for the 12-month period ending 31 December 2018.”

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Ophir made the announcement without the approval of Medco or Medco Global.

Under takeover rules in the UK, Medco Energi Global can make a firm offer or walk away by 28 January.

According to energy research firm WoodMac, Ophir’s existing 25,000bpd of oil equivalent output, combined with Medco’s stated 2018 target of 85,000bpd of oil equivalent, would make Medco the seventh largest non-national oil company upstream producer in South-East Asia, Reuters reported.