Centrica, the owner of British Gas, last night made a £1.3 billion takeover bid for Venture Production, the North Sea gas producer.

Venture’s board said last night that shareholders should reject the offer, adding that it was “not in the best interests of shareholders” and substantially undervalued the company.

Centrica, which had been given a deadline by the Takeover Panel of 5pm on Monday for making a full bid, also announced yesterday that it had increased its stake in Venture from 23.6 per cent to 29 per cent.

It bought a 5.4 per cent stake from 3i, the private equity group.

Centrica, Britain’s largest energy supplier, said that the 845p-a-share all-cash offer represented a 45.7 per cent premium to Venture’s share price on the last trading day before its interest in Venture became known.

Sam Laidlaw, the Centrica chief executive, said: “We are making what we believe to be an attractive offer to Venture shareholders, providing both a significant premium to Venture’s undisturbed share price and certainty now through an all-cash offer at a time of continuing weakness in UK gas prices.”

Mr Laidlaw said that a successful takeover would give the enlarged group an enhanced position in the North Sea and a diversified portfolio of assets. He said Centrica’s backing would provide the financial strength to develop Venture’s business fully.

Mike Wagstaff, the chief executive of Venture, said: “In no way does this offer recognise the strategic position and high quality of our UK gas reserves and resources for which the markets have clearly and consistently established significantly higher values across a number of recent transactions.”

The bid for Venture is Centrica’s second big deal in three months. The company, which raised £2.2 billion in a rights issue last year, took a 20 per cent stake in British Energy, the electricity generator, in May.

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