Oz AWE Supports Mitsui’s Bid

Australian gas producer AWE has recommended its shareholders accept Japanese trading company Mitsui’s takeover bid before it closes April 6, the takeover target said March 27. Mitsui issued March 26 an update of its takeover offer for all of the issued shares of AWE for A$0.95 ($0.73)/share.

AWE flagged what it saw as the key aspects of the update:

• Mitsui will not extend its offer unless its interest in AWE shares exceeds 50.1% before the scheduled close;

• The offer price is final in the absence of a competing proposal;

• Mitsui believes the offer fully recognises the value of AWE’s existing operations and development projects, including the highly saught-after Waitsia Gas Project in Western Australia; and

• Mitsui confirms that it intends to declare the offer unconditional and provide accelerated payment terms such that AWE shareholders will be paid within seven business days if it acquires an interest in AWE shares of more than 50.1% prior to the offer’s scheduled closing date.

“The AWE Board continues to unanimously recommend that shareholders accept the Mitsui offer, in the absence of a superior proposal,” the company said.

The hunt for AWE began on November 30 when China Energy Reserve and Chemical Group (CERCG) made a bid for the company at A$0.71 per share, which it later increased to A$0.73 per share. The day before CERCG’s initial bid, AWE’s closing price was A$0.545 per share.

Mitsui values AWE at A$602mn, a premium of 74.3% to AWE’s closing price on November 29.

AWE has gained attention thanks to the Waitsia gas project in Western Australia. It is also focused on securing new gas sales contracts for Casino and BassGas on the country’s east coast.