Melbourne-based Nexus Energy (NXS) has today launched a takeover offer for upstream oil and gas company Anzon Australia (AZA) worth $648 million.
The deal, which has already been recommended by the board, offers Anzon shareholders a cash and scrip offer of $1.75 per AZA share.
In a statement to the stock exchange, the parties said the merger will ‘create a leader in the Australian oil and gas sector with significant growth potential'.
The valuable AZA asset of Basker Manta, an offshore oil project in the Bass Strait will contribute to the merged entity's estimate resources of 169 million barrels of oil equivalent and an enterprise valuation of about $1.5 billion.
A figure of 4,600 barrels of oil per day from the Baska Manta oil project has been forecast for the 2008 calendar year.
"This merger will combine truly complementary positions focussing on the mature Gippsland basin and the rapidly emerging Browse basin," chairman of Nexus, Michael Fowler said.
"The combination of Anzon's immediate production and Nexus' pipeline of production and development assets will create a unique earnings profile that is characterised by substantial and long term growth."
The proposed entity will be managed by Nexus' managing director, Ian Tchacos.
The two parties have agreed to a sum of $4 million break fee in the event that AZA withdraws its support as a result of a superior offer.
Nexus' offer of $1.75 scrip and cash per share comprises of 71 cents cash per AZA share and Nexus shares to the value of $1.04 per AZA share.
In addition, AZA shareholders will receive a special dividend of 7 cents per AZA share.
Anzon shareholders can opt for all shares, a combination of cash and shares, or the offer of ‘maximum cash' when receiving their consideration.
Nexus has assembled a portfolio of high quality assets, in three key regions including; the Gippsland basin in the south east of Victoria; the Browse basin, off the northwest coast of Western Australia and the Bonaparte basin, west of Darwin.
The primary assets are Crux, Longtom and Echuca Shoals.
Shares in NXS rose 9 cents to $1.41, while AZA rose 18.5 cents to $1.54.
