Accounting firm KPMG has valued Hardman at between $A1.02 and $1.48 per share, well below Tullow Oil’s offering of $2.02/share to investors.

KPMG’s valuation is also much lower than the market’s opinion, which saw HDR open on the Australian Stock Exchange this morning at $2.10.

The report also found that the price, which was a 56% premium to HDR’s closing price before the scheme was announced, “falls within or exceeds the range of takeover premia typically paid in acquisitions in the Australian market”, Hardman chairman Robert Carroll said in a memorandum this morning.

Carroll reiterated that his board considered the $1.47 billion cash offer to be “compelling”.

“The Hardman board believes that the scheme will deliver greater benefits to shareholders than any other alternative available to Hardman, including continuing as a standalone company,” he said.

Following a Federal Court ruling yesterday, Hardman’s shareholders will vote on the proposed takeover on December 18.

If successful, Hardman will stop trading on the ASX two days later.

Oil shows at Uganda well

Meanwhile, Tullow Oil and Hardman, which are partners in Ugandan exploration well Nzizi-1, said the well has encountered oil shows.

The well, which was evaluating certain structures of the Mputa discovery, had yesterday reached a depth of 1065m.

The oil shows are currently being evaluated with wireline logs, Hardman said in a statement.