Australian oil and gas producer AWE signed a binding scheme implementation deed with Mineral Resource Limited under which the latter will acquire all shared of AWE.
Each AWE shareholder will receive as default consideration $0.415 paid in cash and between 0.0198 and 0.0277 Mineral Resources shares per AWE share.
The number of Mineral Resources shares to be issued to AWE shareholders will be determined by the volume weighted average price for Mineral Resources shares calculated over the 10 trading days ending on the day prior to the Scheme vote, AWE said.
Based on consideration of $0.83 per share, the transaction values AWE at a market capitalization of A$526.0 million ($403 million), which is 52.3 percent premium to AWE’s closing price of $0.545 per share on November 29, a day prior to the disclosure that China Energy Reserve and Chemical Group Australia approached AWE with an acquisition proposal.
If the acquisition is implemented, AWE shareholders will own approximately 6.8 percent of the total issued share capital of the combined company.
The transaction is subject to the approval of AWE shareholders at a shareholder meeting expected to occur in mid-April 2018, as well as Court approval and other conditions.