BG Group has noted the announcement and presentation made today by Origin Energy Limited. BG Group is currently finalizing its Bidder's Statement which BG Group expects will be lodged with the Australian Securities and Investments Commission (ASIC) within the course of next week.
"We note that Origin has provided some information to shareholders in response to the issues raised in our announcement on 24 June, 2008. BG Group's all cash offer of $15.50 per share represents a substantial premium to the undisturbed share price and full and fair value for Origin shareholders," said BG Group Chief Executive Frank Chapman.
"It remains the case that Origin must spend a significant amount of time and money to prove up its coal seam gas (CSG) potential. Origin continues to lag its competitors in the exploration and appraisal of its CSG acreage," added Chapman.
"In relation to reversion rights, Origin provided very little new information today. In our view, Origin has still not fully explained the impact on value and capital expenditure associated with these substantial third party interests.
"Origin has not yet addressed the very significant risks for shareholders inherent in any alternative proposals to monetize its gas resources. Nor, in rejecting BG Group's bid, has Origin indicated with any degree of certainty that any of those alternatives could generate higher value for shareholders when compared against BG Group's all-cash offer.
"Our offer is not focused solely on Origin's coal seam gas resources. We wish to retain and invest in all of Origin's businesses in Australia - from gas resources and power generation through to retail gas and electricity marketing. However, access to Origin's resources is not a prerequisite for the delivery of any current or future export commitments within our global portfolio, all of which can be met comfortably from our existing supply arrangements.
"Contrary to the assertions made today, the terms and conditions of our offer conform to market practice and are appropriate for a cash bidder seeking to preserve the assets and capital of the company it intends to acquire. Our offer provides certain cash value for shareholders without ongoing risks. We look forward to engaging with shareholders again after the lodgment of our Bidder's Statement,” said Chapman.
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