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Shell Oil Makes Unsolicited Bid for Barrett Resources
Associated Press
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HOUSTON — Shell Oil Co. has made an unsolicited $1.8 billion bid for Barrett Resources Corp., a natural gas and oil exploration firm based in Denver.

Shell, a subsidiary of the Royal Dutch/Shell Group, would also assume about $400 million of Barrett debt as it tries to establish a presence in the Rocky Mountains, the company said in a statement Wednesday.

The Houston-based Shell notified Barrett's board March 1 of its offer to purchase outstanding shares at $55 apiece, a 21 percent premium over the stock's closing price of $45.62 on Tuesday.

Barrett told Shell its board of directors will consider the proposal at its regularly scheduled meeting Wednesday and Thursday, and will respond no later than Friday. A Barrett spokesman did not return a telephone call Wednesday morning.

Barrett shares rose $14.58, or 32 percent to $60.20 in afternoon trading Wednesday on the New York Stock Exchange.

In addition to board approval, the offer would be contingent on Shell acquiring a majority interest in Barrett.

"Shell appreciates the seriousness with which Barrett's board is approaching our proposal, and we are hopeful that the Barrett board will respond favorably," said Walter van de Vijver, president and chief executive officer of Shell Exploration & Production Co. Shell E&P; is an arm of Shell Oil Co.

In a letter last week to Barrett chairman and chief executive officer Peter A. Dea, van de Vijver invited Barrett to accept the offer or negotiate different terms. He also suggested that Shell would pursue the deal even if Barrett's board votes against it.

"While we would prefer to negotiate and announce a definitive agreement between our companies in the very near term, we are prepared to go forward unilaterally by taking our proposal directly to your shareholders," van de Vijver wrote.

The acquisition would add to Shell's natural gas production reserves in the resource-rich Rocky Mountain region, where the company has no presence, van de Vijver said.

Most of Barrett's 200 employees would keep their jobs, he said.

Lehman Bros. is advising Shell on the possible deal.

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