Senex Energy takeover by Gina Rinehart, South Korea’s Posco has got a green light by the independent expert
Senex Energy has moved closer to a buyout after an independent expert backed the deal.
Senex Energy has moved closer to sealing a $900m takeover after an independent expert backed the deal which will see the Queensland gas producer taken private and into the hands of Gina Rinehart’s Hancock Energy and South Korea’s Posco International.
The Korean steel maker’s international arm prevailed in December with its final bid for the local oil and gas player pitched at $4.60 a share plus a 5c per share dividend for the December half, following three previous offers of $4.40, $4.20 and $4 a share.
Independent expert Lonergan Edwards said the buyout was in the best interests of shareholders, with the value of Senex seen within a range of $4.17 to $4.92 a share compared with the final $4.60 price.
Hancock first approached Posco about a joint tilt for the gas producer after buyout talks were made public with the duo already partners in Ms Rinehart’s Roy Hill iron ore mine in Western Australia’s Pilbara.
Once the deal completes, Hancock will pick up a 49.9 per cent stake in Senex with the deal following it recording a massive $7bn profit, one of the biggest results for a private company in recent memory.
Hancock Energy chief executive Stuart Johnston, who previously worked for rival iron ore billionaire Andrew Forrest, was named as a director of K-A Energy, the vehicle being used to buy Senex.
Posco owns a string of oil and gas projects through Asia, Peru and Oman and also holds existing investments in Australia including a minority stake in Whitehaven Coal’s Narrabri mine in NSW.
The Senex move is seen as part of the Korean company’s global diversification strategy and it is expected to retain Senex’s focus on supplying Australia’s east coast gas market should the deal proceed.
Senex in November announced plans to pay $80m for two gas fields from Australia Pacific LNG, adjacent to its own Atlas project, in a move that will boost Atlas production to 30 petajoules a year in 2024.
Its production focus is on gas from Queensland’s Surat Basin, where it is expecting a rapid growth in output and revenue as supply lifts from its Roma North and Atlas gas projects.
Mr Davies, who is also chairman of the Australian Petroleum Production & Exploration Association, has previously warned the threat of greater regulatory reach into the domestic gas industry could backfire on federal politicians as large users campaigned for intervention to lower prices.
Senex shares rose 0.4 per cent to $4.62.