Otto Energy Accepts Nido's $108M Offer to Acquire Galoc Production Company

Otto Energy Limited (Otto) reported Friday that it has announced Sept. 22 the execution of a sale and purchase agreement (Risco SPA) to divest 100 percent of the shares in Galoc Production Company WLL (GPC) to Risco Energy Investments Pte Ltd (Risco) for $101.4 million. GPC is the holder of Otto's 33 percent interest in the Galoc oil field (Galoc Interest) offshore the Philippines.

Otto is pleased to announce it has now executed a superior sale and purchase agreement with Nido Petroleum Limited (Nido) to divest GPC for $108 million (~AUD 130 million) on the same terms and conditions as the Risco SPA.

Risco has waived its right to match the Nido sale and purchase agreement (Nido SPA) and the Risco SPA has been terminated.

Under the Nido SPA, Nido has agreed to pay Otto $108 million (~AUD130 million) as at July 1. Nido has paid a $1 million deposit, with a further $9.8 million to be paid within 10 business days. Nido will assume all production rights and liabilities associated with the Galoc Interest (including abandonment costs) with effect from July 1.

Similar to the terminated Risco transaction, completion of the Nido transaction is conditional on Otto shareholder approval. Otto will issue a Notice of Meeting seeking shareholder approval for the transaction, with a General Meeting to be held in January 2015.

The Directors of Otto unanimously recommend the Nido transaction to Otto shareholders, in the absence of a superior proposal.

Shareholder Meeting – Dec. 16

Otto has convened a shareholder meeting for Dec. 16 to approve the Risco transaction. Given the Risco SPA is now terminated, Directors have withdrawn their support for this resolution, which will not be put to shareholders at the meeting and, accordingly, there will be no business to be addressed Dec. 16.

Update on Proposed Capital Return

Otto announced on 22 September 2014 that it anticipated a proposed capital return would be paid to shareholders in late 2014 or early 2015, following completion of the Risco transaction, receipt of an Australian Tax Office (ATO) ruling, final director confirmation and shareholder approval. Any capital return to shareholders will now be distributed during 1Q 2015, following completion of the Nido transaction.


View Full Article


Click on the button below to add a comment.
Post a Comment
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

Related Companies

Our Privacy Pledge

Most Popular Articles

From the Career Center
Jobs that may interest you
Project Manager
Expertise: Engineering Manager|Project Engineer
Location: Columbia, SC
Project Manager
Expertise: Engineering Manager
Location: Atlanta, GA
Project Manager
Expertise: Engineering Manager|Project Engineer
Location: Raleigh, NC
search for more jobs

Brent Crude Oil : $51.78/BBL 0.77%
Light Crude Oil : $50.85/BBL 0.83%
Natural Gas : $2.99/MMBtu 4.77%
Updated in last 24 hours