MinRes moves to majority stake in Norwest, with boss Chris Ellison urging holdouts to get on board

MinRes managing director Chris Ellison has teased holdout Norwest Energy shareholders with an upcoming dividend, and says taking up the bid is a ‘no-brainer’.

Mineral Resources managing director Chris Ellison.

Mineral Resources has moved to a majority stake in its bid to buy out Norwest Energy, with managing director Chris Ellison saying the decision for its remaining shareholders to accept the offer is a “no-brainer”.

MinRes is offering one share for each 1300 Norwest shares, with its sweetened bid, up from a one-for-1367 shares proposal, winning the backing of the Norwest board last month.

The miner has now moved to a 53.86 per cent shareholding in the Perth Basin gas junior, with the offer now open until March 2 as a result of it tipping over the halfway mark.

Mr Ellison said in a statement to the ASX that now that his company had effective control of Norwest, it only made sense for the remaining shareholders to accept the offer.

He also dangled the carrot of the upcoming MinRes dividend as an extra enticement.

“I urge Norwest’s remaining shareholders to quickly accept our revised offer and benefit not just from our accelerated payment terms but by ensuring they become entitled to MinRes’ interim dividend,’’ he said. “Accepting our offer is a no-brainer.

“Those who don’t accept will be left behind in a MinRes-controlled company with none of the upside of being a MinRes shareholder or exposure to our world-class portfolio of diversified assets. Those who fail to promptly accept our revised offer will also miss out on receiving our interim dividend and risk having their own share price and liquidity diminish – but will still have to shoulder the burden of their share of significant Perth Basin exploration and development risk.”

Norwest shares closed at 6.5c on Friday, down 1.5 per cent. Mineral Resources stock was 1.8 per cent lower at $85.07, valuing its bid at 6.5c per Norwest share.

MinRes said it would also move to appoint a majority of directors to the Norwest board.

The mining company played an integral role in the takeover battle for another Perth Basin gas player in Warrego Energy, amassing a 19.17 per cent “strategic stake’’ which it eventually tipped into the Hancock Energy bid, allowing it to triumph over Strike Energy. MinRes made a meagre gain on that deal, paying an average 34.8c for its Warrego stake which it then sold to Gina Rinehart’s Hancock for 36c.

Strike, which had pitted a one-for-one share offer against the Hancock bid, itself sold into that bid once the latter had won effective control, and pocketed about $116m in the process.

Originally published as MinRes moves to majority stake in Norwest, with boss Chris Ellison urging holdouts to get on board