Rick Wilkinson
OGJ Correspondent
MELBOURNE, Oct. 29 -- The UK's BG Group has made an expected takeover bid for Brisbane-based coalseam methane (CSM) producer Queensland Gas Co., offering QGC shareholders $5.75 (Aus.)/share (OGJ Online, Oct. 27, 2008).
The offer, on-market and all cash, represents an 80% premium to QGC's Oct. 23 closing price and values the company at about $5.6 billion.
The offer has been unanimously recommended by QGC directors.
BG has already secured the shareholdings of QGC's two largest institutional investors as well as those of QGC Chairman Robert Bryan and managing director Richard Cottee. Combining this with BG's existing interest of 9.9% this takes the UK group's stake in QGC to 17.1%.
AGL Energy and the other QGC directors holding 22% and 7.1%, respectively, have also indicated they will accept BG's offer which will bring BG's stake up to 46.2%.
QGC has said that it is proceeding with its earlier compulsory acquisition of fellow Brisbane company Roma Petroleum Ltd. and will continue its offer for another Brisbane company Sunshine Gas Ltd. until the offer close date of Nov. 4.
Roma and Sunshine shareholders who accept the QGC offer and are issued shares in QGC will also be eligible for the BG offer.
Cottee said BG and QGC are dedicated to ensuring the success of the previously proposed $8 billion (Aus.) Curtis Island CSM-fed LNG project near Gladstone in Queensland. He said BG has the market knowledge, global experience, and financial muscle to make the project happen over the next 5 years.
QGC in its turn has the CSM reserves.
BG Chief Executive Officer Frank Chapman said the takeover will establish a single integrated organization that will optimize the LNG project development and expand QGC's resource base to supply both domestic and export markets.
BG will retain QGC's brand, management, and employees as well as its head office in Brisbane.
BG's move comes just weeks after it abandoned it's $13.8 billion (Aus.) hostile takeover attempt on Sydney-based Origin Energy Ltd.
