Zeta Resources bid for NZ OIl & Gas fails
By Rebecca Howard
Oct. 19 (BusinessDesk) - ASX-listed Zeta Resources' play to seize control of New Zealand & Gas did not meet the minimum acceptance condition and has lapsed, leaving a rival bid from Ofer Group Oil & Gas as the sole offer on the table.
In September, Zeta Energy, a subsidiary of Zeta Resources, formally lodged its offer of 72 cents a share for 42 percent of NZOG's fully and partly paid shares it doesn't already own, subject to scaling. Zeta, which is advised by NZOG director Duncan Saville's ICM unit, had signed lock-up agreements with H&G, Bermuda Commercial Bank, Pan Pacific Petroleum and UIL. It also pitched its bid with the lure of another $50 million capital return to shareholders in the next six months.
NZOG independent directors recommended shareholders reject the offer after an independent valuation by Northington Partners valued the company at 78 cents-to-93 cents a share.
Zeta's bid was further complicated when OGOG, the oil and gas division of Ofer Global Group, came in with a proposal to offer 77 cents a share for no more than 70 percent and at least a controlling stake and then sweetened the deal to 78 cents to fall within the valuation range and winning over NZOG's independent directors who unanimously backed the revised offer.
OGOG aims to preserve NZOG's exploration opportunities and has named the Barque prospect off the Canterbury coast as too interesting to ignore. If it wins over shareholders it plans to find international partners for the deepwater prospect, which was ranked ninth among the world's top oil and gas targets in a survey presented to a recent petroleum conference in New Zealand. In contrast, Zeta wants NZOG to scale back its business.
"Any acceptances for Zeta Energy’s offer no longer have any effect, and shareholders who have lodged acceptances for Zeta Energy’s offer can now, if they wish, accept the OG Oil & Gas offer in respect of the shares tendered to Zeta Resources, along with any shares not tendered," Saville, as Zeta chair, said in a statement.
Saville said the NZOG board had been successful in reducing exposure to Indonesia, trimming costs, and scaling back potential rehabilitation liabilities, which "is reflected in the steady NZO share price appreciation since January 2016 (when the share price was 39 cents) to OGOG’s current offer of 78 cents".
The stock slipped 1.3 percent to 76 cents today.