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Takeover target New Zealand Oil & Gas is advising shareholders to sit tight until two offers to take a controlling interest in the exploration company have been considered.
OG Oil & Gas (Singapore) (OGOG) is making a 77c-per-share offer to acquire 67.55% of New Zealand Oil & Gas (NZOG) it does not already control, which follows an earlier 72c bid by rival Zeta Resources to gain a 50% stake. Zeta already has a 29.5% stake in NZOG.
The three-person independent response committee is also responding to the partial takeover offer from Zeta, NZOG said in a market update.
BusinessDesk reported Zeta saying it planned to make a $50million capital return to shareholders, whereas OGOG was pitching itself as backing management's current plan to seek exploration opportunities.
OGOG chief executive Alastair McGregor told a media briefing yesterday OGOG's offer for NZOG was unsolicited and the strategy put forward by Zeta in its earlier bid forced the OGOG to come up with a competing offer to protect the emerging opportunities.
OGOG said NZOG's Barque prospect off Canterbury was too interesting to ignore.
NZOG has for two years been looking for investment in a joint-venture, deepwater oil and gas prospect 60km off Oamaru, around the exploration prospects Barque and Clipper.
''We have chosen to make a partial takeover as we would like to maintain a listing on the New Zealand stock exchange,'' Mr McGregor said.
''We would like to preserve the company's ability to raise future capital should our vision for the company succeed and incremental capital is required to develop the opportunities that we have identified that the company can take to the next stage from exploration into a production cycle.''
The global oil and gas sector has gone through a protracted downturn, which NZOG has been hoping to benefit from by making some cheap deals at the bottom of the cycle.
Mr McGregor said OGOG sees recent lack of investment as providing opportunities to pursue exploration.