Beach Petroleum bids for Drillsearch Energy

Beach Petroleum NL, Adelaide, made an all-share takeover offer for Drillsearch Energy Ltd. of Sydney that values Drillsearch at $50 million (Aus.).

Rick Wilkinson
OGJ Correspondent

MELBOURNE, May 5 -- Beach Petroleum NL, Adelaide, made an all-share takeover offer for Drillsearch Energy Ltd. of Sydney that values Drillsearch at $50 million (Aus.).

Beach is offering one of its shares for 27 Drillsearch shares, a 20% premium to Drillsearch's closing market price of 2.5¢ on May 4.

Beach already holds 5.3% interest in its target and has entered prebid arrangements with a number of Drillsearch shareholders who represent 4.7% of the company's issued shares, which would bring its relevant interest to 10%.

Beach is keen to develop Drillsearch's assets through its own financial strength at a time when small companies find raising funds extremely difficult. Beach emphasizes its strong management team and track record for developing assets.

Beach's offer is subject to the tender of 90% of Drillsearch's shares.

Drillsearch has interests in a number of Cooper basin permits in which Beach also has a stake, including the Jackson and Naccowlah blocks in the Queensland sector and in PEL 106 in South Australia where Beach recently discovered the Brownlow and Canunda gas fields.

Drillsearch also has interests in the subcommercial Barnett and Turtle oil fields in the Bonaparte Gulf and some assets in Canada.

More in General Interest