- Strike Energy (STX) has responded to Warrego Energy (WGO) rejection for its proposal to purchase the oil company
- This morning, Warrego rejected the proposal as it “undervalued the company”
- However, Strike considers its proposal to be highly compelling
- Strike said that it will most likely not be making another offer
- On market close, Strike Energy is down 13.1 per cent and is selling shares for 8.6¢ apiece
Strike Energy (STX) has responded to Warrego Energy’s (WGO) rejection of Strike’s proposed acquisition.
This morning, Warrego rejected Strikes proposal as it “undervalued the company”. Strike offered to purchase all of Warrego’s shares for 1.2 of Strike’s share per Warrego share.
However, Strike considers its proposal to be highly compelling for Warrego’s shareholders. The proposal was made after market close on March 17. Strike said it attempted to engage informally with Warrego but was unsuccessful.
The offer represents a 28 per cent premium to Warrego’s 5-day volume-weighted average price to March 20.
Strike said that it will most likely not be making another offer.
“For the avoidance of doubt, the proposal does not constitute a takeover bid for Warrego and there is no certainty that Strike will make any further proposal or offer,” Strike told the market.
The proposal also showed a willingness to explore structures that would allow Warrego shareholders to continue to retain 100 per cent ownership or exposure to Warrego’s Spanish assets.
Strike says if the deal goes ahead it will focus on the Perth Basin and develop West Erregulla.
On market close, Strike Energy is down 13.1 per cent and is selling shares for 8.6¢ apiece.