North Sea producer Serica Energy has abandoned its attempt to acquire Pharos Energy after being outbid by Ratio Petroleum Energy.
Serica confirmed it would no longer proceed with its offer after Pharos' board backed an increased all-cash proposal from Ratio worth 32.8183p per share, including a 4p special dividend.
Serica had made a competing offer for Pharos in July and subsequently declared its final proposal of 32.6683p per share would not be increased.
Pharos' directors withdrew their recommendation for the Serica bid after Ratio returned with its improved offer and have unanimously recommended shareholders back the rival deal.
Serica has now confirmed it will not proceed with its final offer, with the Takeover Panel releasing the company from its obligation to complete the transaction.
Pharos shareholders are now due to vote on the Ratio takeover at a Court Meeting and General Meeting on August 28, with the company's directors unanimously recommending they support the deal.
North Sea deal completes
Meanwhile, in the North Sea, NEO NEXT+ Energy has completed its takeover of Deltic Energy after the £6.9million deal became effective today.
The companies agreed terms for the recommended cash acquisition in May, with Deltic shareholders approving the deal the following month.
The North Sea Transition Authority gave its consent to the change of control in July, while the High Court sanctioned the scheme of arrangement on Thursday.
Deltic said all conditions relating to the acquisition had now been satisfied and its entire issued share capital was owned by NEO NEXT+.
Trading in Deltic shares on AIM was suspended from 7.30am today, with their admission to the London Stock Exchange's junior market expected to be cancelled from 7am on Monday.
The takeover brings Deltic's North Sea interests under the ownership of NEO NEXT+, which was formed through the combination of NEO Energy and Repsol Resources UK.