Australia's AWE rejected an unsolicited US$309 million (AU$420 million) takeover bid from US private equity group Lone Star Japan Acquisitions.
Lone Star's proposal was to acquire all of the shares in AWE for a cash consideration of $0.59 (AU$0.80) per share, and was subject to a number of conditions, including due diligence, legal documentation and internal approval conditions.
The board, however, rejected the offer citing it to be opportunistic and failing to reflect the fair underlying asset value of the company. AWE said it has appointed UBS, AG Australia as its financial adviser and Allens as its legal adviser.
AWE’s earnings has taken a massive hit since the collapse in oil prices. In February, the firm reported half year sales revenue of nearly $90 million (AU$122 million) for the 2015-16 financial year, and a net loss after tax of $201 million (AU$274 million). Revenue for the March quarter was $30 million (AU$41 million), down 35% over the previous quarter.
Last week, AWE sold its 42.5% interest in the Bulu production-sharing contract (PSC) in Indonesia to HyOil for up to $20 million (AU$27.5 million). The Bulu PSC includes the undeveloped Lengo gas project, where Singapore-based KrisEnergy is operator. In March, the group sold its 10% stake in Sugarloaf in the US to Carrier Energy Partners for US$190 million.
AWE is divesting assets in order to recycle capital into high-value growth projects, such as the Waitsia gas project in Western Australia, the company said.