UPDATE 1-Glencore to buy Chad oil firm Caracal for $1.3 bln

Mon Apr 14, 2014 10:24am EDT
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* Deal will enable Glencore to expand in upstream sector

* Puts an end to Caracal/TransGlobe Energy merger

* Caracal shares surge more than 58 pct on the news (Adds analyst comment, details on deal and on Glencore's presence in Chad)

By Sarah Young and Silvia Antonioli

LONDON, April 14 (Reuters) - Mining company Glencore Xstrata has agreed to buy Chad-focused oil company Caracal Energy for about 800 million pounds ($1.3 billion), a deal that will allow the commodity giant to expand upstream in the oil sector.

The sale puts an end to Caracal's proposed merger with Canada's TransGlobe Energy Corporation.

Swiss-based commodity producer and trader Glencore agreed to pay 550 pence per share for Caracal, which has been its partner in Chad since 2012, the two companies said in a joint statement put out by Glencore on Monday. The price represents a 61 percent premium to Caracal's closing share price on Friday.

Caracal said it had terminated the proposed merger with TransGlobe and had paid a break-fee of $9.25 million to the Canadian company for abandoning the deal, the statement said.

Caracal's shares surged more than 58 percent in London after the announcement on Monday to 540.6 pence. Shares of TransGlobe were up 0.3 percent in Toronto by 1418 GMT.   Continued...