Senex Energy Ltd., Brisbane, received a revised non-binding takeover proposal from POSCO International Corp. that values Senex at $826 million (Aus.).
The new proposal is to acquire 100% of Senex for a cash offer price of $4.60 (Aus.) per share.
The offer follows three prior non-binding proposals beginning at end July that ranged from $4.00 (Aus.) per share to $4.40 (Aus.) per share in September.
Senex intends to recommend that shareholders vote in favor of the new proposal providing no superior proposal is received, an independent expert’s report concludes the offer is fair, and that an acceptable Scheme Implementation Agreement can be negotiated.
POSCO’s exclusivity period has been extended to Nov. 26 to provide time to negotiate a binding agreement and to obtain internal approvals. POSCO has completed due diligence enquiries.
POSCO told Senex that it wishes to enter discussions and share Senex information with Gina Rhinehart’s Hancock Energy, a subsidiary of Hancock International, regarding the possible participation of Hancock should the proposed scheme be successful. Hancock is partnered with POSCO in the Pilbara iron ore mine at Roy Hill in Western Australia.
POSCO said participation of Hancock will not be a condition of the proposed deal proceeding.
Senex informed POSCO of its $80 million (Aus.) acquisition of Australia Pacific LNG’s natural gas fields in Queensland licenses PL 209 and PL 445, which was announced to the market Nov. 8. The fields are adjacent to Senex’s Atlas gas development which will increase Atlas production to 30 petajoules/year in 2024.
POSCO said its new cash offer is inclusive of the value attributable to the acquisition of the fields.
The offer is subject conditions, including Australian Foreign Investment Review Board approval, court approval, and South Korean regulatory approvals.
Senex holds significant coal seam gas acreage in Surat and Bowen basins of southeast Queensland, including Roma North and Project Atlas developments. It has an annual production of 3 MMboe with proven and probable gas reserves of around 770 petajoules.
POSCO is listed on the South Korean stock exchange. It specializes in oil and gas exploration and production, LNG, agri-resources, and steel production. It has a market capitalization of more than US $2 billion.