Ofer Global Group lifts takeover bid for NZOG

The new offer values New Zealand Oil & Gas at $122 million. Photo / File

Ofer Global Group has lifted its offer for minority holders of New Zealand Oil & Gas by 12 cents to 74 cents a share.

Yesterday, the New Zealand Shareholders' Association said the initial offer of 62 cents was "opportunistic" and that it would oppose the deal. Independent appraiser Northington Partners acknowledged the latest 62-cent offer was "not overly compelling" even if it was reasonable.

Today's price increase was notified by OGOG following an approach from the independent directors of New Zealand Oil & Gas. OGOG is increasing the price on a "last and final" basis, NZOG said in a statement.

OGOG bought the 70 per cent it already owns for 78 cents a share in 2017. The shares last traded at 62 cents.

The new offer, which is also to be effected through a scheme of arrangement, values the company at $122 million. It falls within 62-84 cent independent valuation range and is a 49.5 per cent premium to the closing price on July 9, the last trading day before the scheme was announced.

The chair of the independent response committee, Rosalind Archer, said the independent directors are pleased to confirm their recommendation at an increased price.

"The new price offered by OGOG represents attractive value for existing cash, Kupe and Cue assets and very fair value for exploration assets given current market conditions," she said.

"The scheme will only proceed if 75 per cent or more of the votes cast by minority shareholders are in favour of it. We do not expect a similar opportunity to present itself in the foreseeable future."

A scheme of arrangement, which requires the support of a company's board, makes a takeover easier to achieve than if it was made under the Takeovers Code, which requires acceptance for 90 per cent of the company's shares before the acquirer can move to compulsory acquisition.

Shareholders were to vote on the offer at a special meeting on October 16.

That date has been pushed back to November 14. Shareholders who have already voted can change their vote in the light of the increased scheme price.

NZOG has a 4 per cent stake in the Kupe gas field and a 5 per cent interest in the Maari oil field through its Melbourne-based Cue Energy subsidiary. It also has controlling stakes in the Clipper and Toroa exploration permits off the South Island and a 15 per cent direct interest in the Ironbark project. Drilling of that prospect by the BP-led venture is scheduled for late 2020. Cue also has a 21.5 per cent stake in that venture.