Cue Energy Advises Shareholders to Reject NZOG's Takeover Offer

Australia's Cue Energy Resources Ltd.'s directors recommended that company shareholders should reject the unsolicited, on-market takeover offer by NZOG Offshore Limited, a wholly owned subsidiary New Zealand Oil & Gas Ltd., chairman Geoffrey King said in a letter Tuesday.

NZOG Offshore offered Feb. 12 to acquire all of the shares in Cue Energy that it does not already own at $0.0765 (AUD 0.10) per share, or $0.00765 (AUD 0.01) per share higher than the previous day's closing price of Cue Energy shares.

Cue Energy noted that shareholders own part of a growing oil and gas producer with a focus on Southeast Asia and Australasia. The firm has strong production assets, an active exploration program and a robust balance sheet with no debt and cash reserves of $28.3 million (AUD 37 million, with those cash reserves equivalent to $0.0405 or AUD 0.053 per share).

The directors commented that the offer price is inadequate and substantially undervalues Cue Energy shares citing:

  1. the offer price of $0.0765 (AUD 0.10) per share substantially undervalues Cue Energy
  2. the timing of the offer is opportunistic
  3. NZOG Offshore already holds a 19.99 percent interest in the shares of Cue Energy, and is seeking to gain control of Cue Energy without paying an appropriate control premium; and
  4. Cue Energy has an existing, clear strategy for its business, which is designed to maximize value for all Shareholders. The Board believes that its strategy is superior to NZOG Offshore's announced intentions.

They therefore "unanimously recommend that you (shareholders) reject the offer," the chairman said in the letter released Tuesday.

Meanwhile, the directors have appointed Grant Samuel to prepare an Independent Expert's report to look into whether or not the offer is fair and reasonable to Cue Energy shareholders. The Independent Expert's report is expected to be released to the Australian Securities Exchange on or about March 2.

Have a news tip? Share it with Rigzone!


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

More from this Author
Rigzone Staff
e-mail us at
 -  Aker Solutions to Buy Brazilian C.S.E (Oct 21)
 -  Sea Trucks Group Secures Work Offshore... (Oct 21)
 -  Shell Divests Non-Core Oil, Gas Proper... (Oct 21)
 -  Petrofac Appoints New CFO (Oct 21)
 -  Wheatstone LNG Development Start-Up in... (Oct 20)

Most Popular Articles

From the Career Center
Jobs that may interest you
Project Manager
Expertise: Engineering Manager|Project Engineer
Location: Chicago, IL
Executive Assistant
Expertise: Executive|Secretarial or Administrative
Location: United States
Regional Manager - Saybolt
Expertise: Executive|Operations Management
Location: Linden, NJ
search for more jobs

Brent Crude Oil : $51.38/BBL 2.44%
Light Crude Oil : $50.43/BBL 2.26%
Natural Gas : $3.14/MMBtu 0.94%
Updated in last 24 hours