Serica welcomes Salamander withdrawal



    LONDON, Oct. 21 /CNW/ - Serica Energy plc (AIM & TSX-V: SQZ) ("Serica" or
"the Company") notes the announcement made by Salamander Energy plc
("Salamander") earlier today, stating that it is no longer considering making
an offer for Serica (the "Announcement").
    Tony Craven Walker, Serica Chairman, said: "We are glad that Salamander
has decided not to proceed with its hostile all paper approach as this now
allows both companies to get back to the business of growing their assets for
the benefit of shareholders. It is the view of the Serica board that
Salamander's proposed offer significantly undervalued Serica's core assets,
put no value on its growth prospects, paid no premium for change of control
and would have greatly diluted Serica shareholders' exposure to its material
upside potential. As a result the proposed offer did not represent fair
relative valuation of the two companies and was rejected unanimously by the
Serica board.
    "Serica has a clear independent strategy for growth and its prospects are
excellent. Kambuna field production and Columbus field development are both
slated to get underway in 2009, and the Company has major stakes in an
important exploration drilling programme in the UK, Ireland, Indonesia, Norway
and Vietnam due to start in November and to continue through 2009. We have
developed a significant balanced portfolio in two areas of focus, North West
Europe and South East Asia. Serica has built a portfolio centred on large
gas-prospects rather than oil prospects and, with the price of gas tending to
be less volatile than that of oil, we believe that our programme is less
exposed to the current uncertain oil price scenario.
    "With an increasing amount of sector consolidation occurring, we remain
fully mindful of opportunities for acquisitions that present themselves at
times such as these. However, any transaction must take full recognition of
strategic intent, the balance of assets and the additional value that can be
generated for shareholders."

    Background

    On Friday 26 September 2008, Salamander made a non-binding proposal to
the board of Serica to acquire the Company on the basis of one new Salamander
share to be issued for every three Serica shares held (the "Proposal") and
gave the board of Serica 48 hours to respond. On 28 September 2008, Serica
informed the board of Salamander that the Serica board had unanimously
rejected the Proposal. On 29 September 2008, Salamander publicly announced the
Proposal, following which Serica made an announcement informing shareholders
why it had rejected the Proposal. On 16 October 2008, the Panel on Takeovers
and Mergers in London ruled that Salamander must, by 5:00pm on 10 November
2008, either announce a firm intention to make an offer for Serica or announce
that it does not intend to make an offer.
    Following the Announcement, under the rules of the City Code on Takeovers
and Mergers, Salamander is now prevented from announcing an offer or possible
offer for Serica within the next six months, unless one of the events
specified in the Announcement occurs.
    Further information on Serica's interests can be found on Serica's
web-site at www.serica-energy.com

    
    The TSX Venture Exchange has not reviewed and does not accept
    responsibility for the adequacy or accuracy of this release.
    

    To receive Company news releases via email, please contact
sasha@chfir.com and specify "Serica press releases" in the subject line.

    %SEDAR: 00022686E




For further information:

For further information: Enquiries: Serica Energy plc, Paul Ellis, Chief
Executive Officer, paul.ellis@serica-energy.com, +44 (0)20 7487 7300; Chris
Hearne, Finance Director, chris.hearne@serica-energy.com, +44 (0)20 7487 7300;
JPMorgan Cazenove, Steve Baldwin, steve.baldwin@jpmorgancazenove.com, +44
(0)20 7588 2828; Tristone Capital Limited, Majid Shafiq,
mshafiq@tristonecapital.com, +44 (0)20 7355 5872; Pelham Public Relations -UK,
James Henderson, james.henderson@pelhampr.com, +44 (0)20 7743 6673; Alisdair
Haythornthwaite, alisdair.haythornthwaite@pelhampr.com, +44 (0)20 7743 6676;
CHF - Canada, Sasha Abrams, sasha@chfir.com, (416) 868-1079

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SERICA ENERGY PLC

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