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- Oil and gas explorer FAR (FAR) has received a conditional, non-binding indicative proposal from Russian energy company PJSC Lukoil
- At at 2.2 cents a share, Lukoil’s proposal values FAR at approximately A$220 million
- This complicates matter for FAR, which is already considering different proposals from Woodside (WPL) and Remus Horizons
- The company has decided to postpone its scheduled shareholders meeting until it can clarify the status of the Lukoil proposal
- FAR is in the grey and trading at 1.1 cents per share
Oil and gas explorer FAR (FAR) has received a conditional, non-binding indicative proposal from Russian energy company PJSC Lukoil.
Lukoil is a crude petroleum and natural gas extraction business and one of the largest publicly traded energy companies in the world.
At at 2.2 cents a share, Lukoil’s proposal values FAR at approximately A$220 million.
This complicates matters for FAR, which has already been presented with two different offers from two separate entities.
The company is currently considering the proposed sale of its interest in the Rufisque Offshore, Sangomar Offshore and Sangomar Deep Offshore (RSSD) joint venture project to the RSSD operator, Woodside (WPL).
FAR is also considering an incomplete, non-binding takeover bid from Remus Horizons, which recently halted the company’s asset sale to Woodside.
Lukoil has stated that its proposed buyout is worth more to FAR shareholders than both the Woodside sale and Remus takeover.
The Russian bidder has also declared that it is a strong candidate for acquiring the company, given its deep understanding of the RSSD Project. Lukoil previously completed due diligence and entered into an agreement to acquire interest in the project, but was pre-empted by Woodside.
Lukoil’s proposal to FAR is not currently a legally binding offer and is subject to due diligence as well as Board approval. The offer is also conditional on FAR’s shareholder meeting scheduled for tomorrow being postponed and on Lukoil obtaining minimum acceptances of 50.1 per cent of shares.
If approved, Lukoil’s proposal will be funded by available internal cash reserves. It may also involve financial support to help FAR resolve being in default on its RSSD Project cash commitments.
FAR has decided to postpone its shareholders meeting scheduled for tomorrow, at which the company was meant to consider approval the sale to Woodside. During this postponement, the company will clarify the status of the proposal from Lukoil.
FAR is in the grey, trading at 1.1 cents per share at 2:32 pm AEDT.
