Mako Acquires JV Partner Harness
Mako has accepted offers from all Harness shareholders to acquire 100% of its Joint Venture partner.
The acquisition will be effected by its subsidiary Mako Energy (Australia) for the sum of $1M payable in MKE shares (5 million shares @ 20 cents). All shares will be escrowed for a period of 12 months from their issue.
The acquisition will double the Company's asset base which has been independently assessed on a risked basis at $68M (post acquisition). The combined entity's assets include original oil in place (OIIP) of 80M barrels.
None of the vendors are related parties under the terms of the Corporations Act, or associates for the purpose of the ASX Listing Rules.
The key outcomes of the proposed transaction would be:
- Doubling of the asset base of Mako (to a risked value of $68M, as assessed by Strachan Corporate1
- Independently projected OIIP of 80M barrels; ) for the payment of $1M in scrip and the assumption of approximately $1.65M of serviced debt;
- The acquisition of modest revenue producing assets (sufficient to service all assumed debt);
- Amalgamation of all corporate, executive and technical personnel to deliver on the proposed ‘business plan’; and
- Assumption of an operational center in Calgary and the ‘alignment of interests’ of all Mako and Harness stakeholders.
Mako Chairman Mr Simon Owen said the proposed acquisition of JV partner Harness Petroleum was the first, and logical, step in establishing an integrated Canadian oil & gas business.
"For an issue of $1M in shares and the assumption of approximately $1.65M of serviced debt, we will double our asset base to over $65M an independently projected OIIP of 80M barrels," he said.
"With the acquisition of 100% of the JV assets and Harness' existing modest production, we will have completed our first major acquisition and be able to 'book' our first production, on the first day of trading. We will then immediately move to bring other projects into production and assess a number of additional opportunities."