The largest minority investor in oil explorer Dragon Oil said it would reject a takeover bid from controlling shareholder Emirates National Oil Company (Enoc) that values Dragon at $3.9 billion.

Baillie Gifford & Co said in a statement emailed on Wednesday that the 455 pence/share offer 'materially understates the fundamental and strategic value' of Turkmenistan-focused Dragon.

'We plan to reject the offer on behalf of our clients, whose holdings under our management currently amount to 4.2 percent of the issued share capital of the company,' Richard Sneller, Head of Emerging Markets Equities said.

Analysts said the stock was probably worth more than the offer from Dubai state-controlled Enoc, which already owns 52 percent of London and Dublin-listed Dragon.-Reuters