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Norsk Hydro, Statoil Raise Saga Bid

June 10, 1999

OSLO, Norway (AP) _ Norway’s state-controlled oil companies, Statoil ASA and Norsk Hydro ASA, offered more money Thursday for Norway’s No. 3 oil company, Saga Petroleum ASA, in an effort to outbid France’s Elf Aquitaine.

The Norwegian companies offered 135 kroner ($17.22) per share in stocks and cash for Saga shares, 10 kroner ($1.27) more than Elf’s cash bid earlier this week. That values the privately held Saga at about 20 billion kroner ($2.55 billion).

Saga’s shares immediately rose on the Oslo Stock Exchange.

``The objective of the transaction is to create value for Hydro’s and Statoil’s shareholders by optimizing development and operations of oil and gas reserves,″ Norsk Hydro said in a news release.

The Norsk Hydro-Statoil bid is contingent on 70 percent of Saga’s shareholders accepting the offer by June 18.

Saga Petroleum’s board scheduled a meeting Friday to consider the competing offers.

There was no immediate comment from Elf.

Saga controls vast oil and natural gas reserves, mainly off Norway. It announced austerity measures this year after posting losses for 1998.

Following its original bid, Norsk Hydro agreed with Statoil AS, which already owns 19.4 percent of Saga, to split Saga’s assets so Statoil would get 25 percent. Norsk Hydro would take the rest.

Saga employees had supported Elf’s bid because the French company promised Saga would continue operating under it own name, while the Norwegian offer would break it up.

Norsk Hydro, which employs about 40,000 people worldwide, now promises to add Saga’s employees to its own staff, although Saga would still be broken up.

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