Cooper Energy Limited advises that it has today lodged its Bidder’s Statement with respect to the Company’s offer to acquire all of the shares in Incremental Petroleum Limited.
To acquire each Incremental share, Cooper Energy is offering Incremental shareholders a choice of:
• 3.1 Cooper Energy shares (All Share Alternative); or
• 50 cents cash and 1.9 Cooper Energy shares (Cash and Share Alternative).
Based on the respective closing prices of the two companies on 5 September 2008 – the trading day before the bid was announced – the All Share Alternative values Incremental at $1.32 per
share, representing a premium of 35% to the closing price prior to the announcement.
Incremental shareholders will also be entitled to retain Incremental’s unfranked dividend of 3 cents per share, which is payable on 17 October 2008.
In addition to providing a premium for Incremental shares, the offer is structured so as to give Incremental shareholders the choice of either receiving maximum exposure to the growth potential of the merged group by accepting the All Share Alternative, or receiving cash while maintaining some exposure to these benefits by accepting the Cash and Share Alternative.
Cooper Energy’s Managing Director, Michael Scott, said the offer was compelling and represented a unique opportunity to generate significant value for both Incremental and Cooper Energy shareholders.
“By combining these two highly attractive and complementary businesses, we have a rare opportunity to create one of Australia’s leading mid-tier oil and gas companies boasting an outstanding mix of international exploration, development and production assets in proven and established hydrocarbon provinces,” Mr Scott said.
“This is an opportunity to create an expanded asset base and a powerful global platform that is expected to deliver enhanced cash flow and growth options for many years to come.”
The merged group would benefit from increased oil production and proven reserves by consolidating nine oilfields in Australia, Turkey and the USA. Based on the respective annual production levels of the two companies through to 30 June 2008, the merged group’s daily production would be approximately 80% higher than that of Incremental. The merged group’s more diversified production base would also reduce production concentration risk.
Similarly, the merged group would benefit from a broader spread of quality exploration, appraisal and development assets in proven hydrocarbon provinces in Australia, Indonesia, Turkey, Tunisia and the USA.
“In addition to increased production revenue, Cooper Energy’s high levels of cash reserves and strong balance sheet would give the merged group the firepower it needs to pursue a more aggressive investment strategy across the new global portfolio,” Mr Scott said.
“With an estimated market capitalisation of approximately $200 million, the merged group is also likely to attract increased institutional investment interest and be able to better weather the storms now blowing through the world’s financial markets.”
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