Drillsearch Energy announced that it has completed the acquisition of more than 28 million shares (19.5%) of the total issued share capital in Ambassador Oil and Gas. This agreement is pursuant to the terms of share purchase deeds dated 28-May-2014 executed between the two companies.
Under the share purchase deeds, Drillsearch made an off-market takeover offer to Ambassador, under which Ambassador shareholders are offered one Drillsearch share for every 5.4 Ambassador shares. The offer implied a value of A$0.293 (US$0.271) per Ambassador share, based on the closing price of Drillsearch shares of A$1.58 on 27-May-2014.
Drillsearch said that the transaction will consolidate its position in the Northern Cooper Wet Gas area by combining Ambassador's 47.5% non-operated interest in PEL570 with Drillsearch's 80% owned and operated interest in the adjacent PEL101.
On 11-Jun-2014, Magnum Hunter Resources also revealed that it intends to offer one of its shares for every 27.8 Ambassador shares, valuing Ambassador's shares at A$0.34 (US$0.32) each.
Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.