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Houston-based Endeavour International Corp. (NYSE:END) CEO William Transier confirmed on Tuesday that it had abandoned its bid to buy out Ithaca Energy Inc. (OTCPK:IACAF).

Mr. Transier said:

We still believe that a merger of Endeavour and Ithaca would provide an excellent catalyst for enhanced shareholder value through the creation of a combined company with greater scope and scale.

When bidding for Ithaca, Endeavour claimed that the combined company would benefit from improved access to capital markets, and also enjoy more competitive rates when negotiating for rigs and services. Endeavour's North Sea operations share a geographical proximity to Ithaca's.

Mr. Transier also said:

We believe that this is a missed opportunity. [But] with our current cash flow, access to capital and production profile, Endeavour has a number of strategic opportunities to pursue. Therefore, we will no longer pursue our proposed offer.

Ithaca Energy rejected Endeavour's unsolicited offer of C$3.25 per share on Monday, judging the upside insufficient in light of upcoming catalysts for the stock, which include vastly upgraded oil estimates from the company.

As he announced the unanimous rejection, John Summers, Ithaca's chairman said:

Ithaca has a number of ongoing initiatives that will be concluded in the near term which we believe will provide greater value for Ithaca's shareholders.

Both stocks were down about 8% on Tuesday afternoon.

Source: Endeavour Abandons Bid for Ithaca Energy