Senex Energy has received an improved takeover offer of A$4.60 per share from the trading arm of South Korea’s steel company POSCO International.
The offer represents a deal value of $630m (A$852m), according to Reuters.
The acquisition offer follows the bid launched by POSCO in September 2021 to buy Senex for a cash offer price of A$4.40 per share.
Prior to this, POSCO submitted two non-binding proposals of A$4.20 per share and A$4.00 per share in August and July 2021 respectively, to buy the Australian coal seam gas producer.
The company has also extended POSCO International’s exclusivity period to 26 November. This is intended to give time to negotiate and sign a binding scheme implementation agreement.
In a press statement, Senex said: “Subject to negotiating an acceptable Scheme Implementation Agreement, no superior proposal and an independent expert concluding that the transaction is fair and reasonable and therefore in the best interests of shareholders, the Senex Board intends to unanimously recommend that shareholders vote in favour of the proposed transaction.”
In a separate announcement, Senex Energy has agreed to acquire undeveloped gas fields PL 209 and PL 445 in Australia from Australia Pacific LNG for $59.2m (A$80m).
The two fields are located adjacent to Senex’s Atlas natural gas development.
The fields include a 77km² development-ready Northern Area, and a 77km² Southern Area, which requires further appraisal.
Under the deal, Senex Energy will make an initial payment of $50m to purchase the fields.
A further $30m will be paid to Australia Pacific LNG upon receipt of satisfactory Commonwealth environmental approvals.
As per the estimates, the Northern Area has an ultimate recoverable volume of 184 PJ while the Southern Area has 600 PJ of estimated gas-in-place.
Senex Energy managing director and CEO Ian Davies said: “The acquisition of these undeveloped gas fields adjacent to Atlas continues Senex’s growth trajectory in the Surat Basin and reinforces the company’s low-cost, hub-and-spoke infrastructure operating model.
“Atlas is a high-quality development, providing reliable, affordable and sustainable supplies of natural gas to Australian manufacturers, supporting the economy and jobs in local communities.”
Subject to limited and customary conditions and consents, the transaction is planned for completion by early 2022.