OG Oil & Gas, the oil and gas division of Ofer Global Group, is pursuing a partial takeover of New Zealand Oil & Gas to keep the local energy explorer's NZX listing and the access to future capital it provides.
The Ofer unit has offered 77 cents per share for a maximum of 70 per cent of NZOG to trump a rival bid by Zeta Resources which OGOG chief executive Alastair McGregor says is the only way to preserve the opportunities in front of the Wellington-based company. Both companies have lodged partial takeovers for NZOG, with Zeta saying it plans to make a $50 million capital return to shareholders, whereas OGOG is pitching itself as backing management's current plan to seek new exploration opportunities.
McGregor told a media briefing that OGOG's offer for NZOG was unsolicited and the strategy put forward by Zeta in its earlier bid forced the Ofer unit to come up with a competing offer to protect the emerging opportunities.
"We have chosen to make a partial takeover as we would like to maintain a listing on the New Zealand stock exchange," McGregor said. "We would like to preserve the company's ability to raise future capital should our vision for the company succeed and incremental capital is required to develop the opportunities that we have identified that the company can take to the next stage from exploration into a production cycle."
The global oil and gas sector has gone through a protracted downturn, which NZOG has been hoping to benefit from with some cheap deals at the bottom of the cycle, and McGregor said OGOG sees that lack of investment in recent years as providing opportunities to pursue exploration to replenish diminished reserves and that "now is the right time that work should be undertaken".
