Ofer Group lifts takeover bid for NZOG

Oct. 9, 2019
Eyal Ofer’s Singapore-based OG Oil & Gas (OGOG) has increased its offer for minority stakeholders of New Zealand Oil & Gas Ltd. (NZOG) by 12¢ to 74¢ (NZ)/share.

Eyal Ofer’s Singapore-based OG Oil & Gas (OGOG) has increased its offer for minority stakeholders of New Zealand Oil & Gas Ltd. (NZOG) by 12¢ to 74¢ (NZ)/share.

OGOG announced the new price after an approach from the independent directors of NZOG. The increase has been made on a “last and final” basis, according to a statement from NZOG.

OGOG is attempting to acquire all the 30% of NZOG shares that it does not already own. The company bought the first 70% for 78¢ (NZ)/share in 2017.

An initial offer of 62¢ (NZ)/share in July this year for the last 30% had been branded as “opportunistic” by the New Zealand Shareholders’ Association (OGJ Online, July 15, 2019).

The new bid values NZOG at $122 million (NZ). It falls within 62-84% independent valuation range carried out by Auckland-based investment banker and corporate advisor Northington Partners and is a 49.5% premium to the closing price on July 9—the last trading day before the scheme was announced.

NZOG’s independent directors have now recommended the transaction at the increased price.

“The new price offered by OGOG represents attractive value for existing cash, Kupe and Cue assets and very fair value for exploration assets given current market conditions," a spokeswoman said.

“The scheme will only proceed if 75% or more of the votes cast by minority shareholders are in favor of it. We do not expect a similar opportunity to present itself in the foreseeable future,” she added.

A scheme of arrangement requires the support of a company's board and makes a takeover easier to achieve than if it was made under the Takeovers Code, which requires acceptance for 90% of the company’s shares before the acquirer can move to compulsory acquisition.

NZOG’s assets include the highly thought of offshore Barque prospect in about 800 m of water in the Canterbury basin off Christchurch in the South Island.

NZOG also has 15% interest in the Ironbark prospect in permit WA-359-P off Western Australia operated by BP and 40% interest in Beach Energy’s offshore Otway basin assets in western Victoria.

The company also has cash reserves of about $98 million (NZ).