NORTH Sea-focused RockRose Energy has increased the pressure on takeover target Independent Oil & Gas as it looks to continue its rapid expansion by offering to acquire debt owed by the firm.

RockRose said it had made a £40 million offer to acquire all the debt owed by Independent to the main funder of the business, London Oil & Gas.

The move came weeks after Independent snubbed a £26m takeover proposal for the firm made by RockRose Energy, which is based in London.

Read more: North Sea oil firm in bold expansion move

Independent said the proposal was opportunistic and materially undervalued the company and the potential of its acreage in the North Sea. This contains finds that Independent hopes to bring into production

RockRose said then it may not make an offer for the shares in Independent Oil & Gas, which it claimed might struggle to raise the funds needed to realise its plans.

However, the offer to buy the debt owed by Independent could provide another route for RockRose to take control of the firm, which is facing potential funding complications.

Independent has found itself in the spotlight as a result of developments at London Oil & Gas, which was funded by a firm that went into administration after raising £236m from investors following the sale of mini-bonds.

The Serious Fraud Office recently launched a probe into the firm concerned, London Capital & Finance, and four individuals associated with it.

Independent noted last Tuesday that London Oil & Gas was expected to enter administration that day. It said then the terms of its loans from London Oil & Gas remained unchanged.

Read more: Shake up in North Sea to continue after $140m acquisition of US giant's assets

The company said it continued to progress negotiations with a shortlist of well-funded farm-in partners and was well advanced with financing plans which were unrelated to and unaffected by LOG’s administration.

However, RockRose has cast doubt on Independent’s ability to raise the funding for a development that could cost around £450m on terms that would be attractive.

RockRose yesterday criticised accountancy firm Smith & Williamson, joint administrator of London Capital & Finance and of London Oil & Gas. It claimed Smith & Williamson had not complied with its request to provide details of the conditions attaching to the loans provided to Independent by London Oil & Gas.

RockRose said there was a “clear pressing need to recover cash for the benefit of the creditors of LOG and LCF”.

A spokesperson for the Joint Administrators of London Capital & Finance commented: “The administrators of LCF confirm they have been approached by an external party to buy the loans to Independent Oil & Gas. This offer is being carefully considered, and specialist professional advice is being taken, to ensure any decision taken is in the best interests of the bondholders of LCF.”

Read more: Oil price fall to create North Sea acquisition opportunities for London firm

Independent said RockRose’s £40m offer for the debt owed to London Oil & Gas did not offer fair value for the rights to acquire shares in the firm attaching to the relevant loans.It said the key terms of the loans were all in the public domain.

Fiona MacAulay, chair of Independent Oil & Gas said: “We are making good progress with shortlisted partners on our farm-out process and continue to believe that our strategy will deliver significantly better stakeholder returns than RockRose’s derisory proposals.”

Founded by former investment banker Andrew Austin in 2015, RockRose has expanded rapidly after making a series of acquisitions amid the shake-up in the Noth Sea triggered by the crude price plunge from 2014.

While some giants decided to cut their exposure to the North Sea a range of smaller firms concluded the downturn created an opportunity to expand with assets being put up for sale at attractive prices. The cost of support services fell sharply.

In February RockRose agreed to buy the North Sea portfolio amassed by America’s Marathon Oil in a £107m deal that is set to make it a major player in the area.

Independent bought assets such as a stake in the Blythe gas field off eastern England and a disused pipeline in the area.

The holders of $150m bonds issued by Xcite Energy bought its interest in the undeveloped Bentley oil field off Shetland in a $1 deal after the firm entered liquidation in 2016.