Strike closes off-market takeover bid for Warrego
Strike Energy on February 15 announced its off-market takeover bid for Warrego Energy has now closed. It will accept Hancock Energy’s cash offer of A$0.36 ($0.25)/Warrego share which will realise A$136mn in proceeds to Strike.
As of February 15, Strike owned about 30.4% of Warrego’s shares. As a result, it will receive A$136mn in proceeds which is the equivalent of Strike conducting an equity capital raise at A$0.40/Strike share or a 16% premium to its last closing price of A$0.345/share.
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Warrego, which owns assets in the Perth basin, had been at the center of an intense takeover battle over the past couple of months. In addition to Strike and Hancock, Beach Energy was also eyeing Warrego.
“The decision to accept Hancock’s offer and receive a substantial and certain funding injection provides clarity on the development pathway for the Greater Erregulla gas resources,” the company said. “Strike looks forward to working with its new joint venture partner in Hancock as the controller of the Warrego share of the West Erregulla gas field in EP469 where Strike is the operator and owns the other 50% of equity.”
With the advent of securing the A$153mn of domestic gas financing via Macquarie Bank, Strike will have A$203mn of cash and available undrawn facilities and a further A$80mn in an uncommitted domestic gas development facility to support the acceleration of its gas, fertiliser and renewables strategy and execute its next final investment decision.
Strike said it is currently conducting a capital allocation review and will provide further information on the additional activities that will be funded under this acceleration strategy in due course.