Article by Nick Toscano courtesy of the Sydney Morning Herald.
Gina Rinehart, the nation’s richest person, has waived all conditions in her bid to buy Western Australian gas explorer Warrego Energy, a move she hopes will lock in the support of key shareholders amid a takeover tussle with rival suitor Strike Energy.
Hancock Energy, the energy arm of the mining billionaire’s privately owned Hancock Prospecting , on Friday said its 28¢-a-share cash bid for ASX-listed Warrego and the prized 50 per cent interest it holds in a promising onshore gas basin north of Perth was now unconditional “with immediate effect”.
Hancock last week said it had received statements of intent for various independent Warrego shareholders holding a combined 15.84 per cent of Warrego shares.
“Those supportive shareholders informed Hancock and Warrego that they independently will accept Hancock’s offer if Hancock declares its offer unconditional within two trading days of the shareholders statements’ being released to the ASX,” it said on Friday.
The move comes as Strike Energy – Warrego’s partner in the West Erregulla gas field – also stepped up its efforts for control of the company on Friday, lodging a bidder’s statement urging Warrego investors to accept its all-scrip deal instead.
Strike said its one-for-one shares offer, which valued Warrego at $404 million or 32¢ a share, represented a 17 per cent premium to Hancock’s bid. It would also enable investors to retain their exposure to a “high-quality Perth Basin asset portfolio” during a time of rising natural gas prices, Strike said.
“Hancock’s competing proposal places a final and terminal value on Warrego,” the company said. “Strike’s offer will allow Warrego shareholders to participate in ongoing upside.”
Strike added that its offer had “limited conditionality” and may soon be declared unconditional, too.
Warrego shareholders holding 15.45 per cent had also confirmed their intention to support a merger of Strike and Warrego, according to Strike Energy.
Larger energy companies including Hancock, Strike and billionaire Kerry Stokes-backed Beach Energy have been bidding for Warrego because of its half-ownership of WA’s West Erregulla gas field that could quickly be brought into production without the need for hydraulic fracturing in a domestic gas market that is tipped to tighten in the coming years.
Last week, mining billionaire Chris Ellison’s Mineral Resources confirmed it was also looking to join the race to consolidate gas assets in the Perth Basin. The $15 billion WA-based iron ore, lithium and mining services company said it planned to make a $403 million off-market bid for the shares it does not already own in oil and gas explorer Norwest Energy, its minority joint-venture partner in the Lockyer Deep project.
