Norway's DNO to buy UK-listed Capricorn Energy for $396 million

Sept 1 (Reuters) - Norwegian oil firm DNO has agreed to buy UK's Capricorn Energy for $396 million, the companies said on Tuesday, outbidding rival Genel Energy. 

• Kurdistan-focused DNO will offer $5.214 in cash for each Capricorn share, higher than Genel's offer of $4.74 per share made in July.

• Capricorn's board on Tuesday said it would recommend DNO's superior offer to its shareholders, withdrawing its support for Genel's $360 million proposal.

• In a separate statement, Genel said it is considering its position regarding Capricorn and will make a further announcement when appropriate.

• DNO's interest in Egypt-focused Capricorn comes weeks after its attempt to buy Genel was turned down on concerns of undervaluation.

• Dealmaking among oil companies operating in the Middle East is gathering pace as a surge in oil prices after the onset of the Iran war in February has enabled some energy firms focused on the region to pursue mergers and acquisitions.

• Capricorn had drawn takeover interest for months, including from Saudi Arabia's privately held Cafani Group and private equity firm Samos before they walked away from the talks.

(Reporting by Prerna Bedi and Yamini Kalia in Bengaluru; Editing by Janane Venkatraman and Jonathan Ananda)