Ann: Ceasing to be a substantial holder from SXY , page-28

re: Ann: Ceasing to be a substantial holder f... November 1, 2012, 5:34 PM
Bidding War for Acer Fizzles
Deal Journal Australia HOME PAGE »


By Ross Kelly
Punters banking on a protracted takeover battle for Australian oil and gas prospector Acer Energy ACN.AU -0.70%have been left high and dry.

Drillsearch Energy DLS.AU -2.31%has taken control of the company, which has acreage in outback Australia, after a potential rival bidder Senex Energy SXY.AU -4.73%dropped out, selling its Acer shares into Drillsearch’s offer.

In what has turned out to be a knockout punch, Drillsearch last week raised its cash offer to 28.5 Australian cents per Acer share from its original 25.5 cents bid, valuing Acer at 132.3 million Australian dollars (US$137.2 million).

Since the original offer was launched on Oct. 4, Acer shares have traded as high as 29.5 cents. They were still trading higher than Drillsearch’s offer Wednesday when they closed at 29 cents as some investors hung out for a counterbid.

Those taking a punt gained inspiration on Oct. 8 when Senex took a 6.2% interest in Acer and wouldn’t rule out making a rival bid, saying it would consider its options.

“At the end of the day, you don’t get anywhere without holding some equity,” Senex Chief Executive Ian Davies said in an interview at the time. “It’s all about making money for my own shareholders.”

Senex later bumped up its holding to 7.6% on Oct. 19 then bumped it up again on Oct.29 to 8.6%.

Its sudden capitulation is curious, given it’s been paying a premium to buy Acer shares on market and bought its last tranche after Drillsearch had already sweetened its offer.

Senex paid 26.5 cents per share for its first 23.1 million Acer shares, 27 cents for the next 6.7 million and 28.5 cents for the remaining 10.2 million. That works out at a total outlay for its 40 million shares of A$10.84 million.

It has sold them back to Drillsearch for A$11.4 million, which makes you wonder what all the fuss was about.

All the company would say Thursday is that it looks forward to working with Drillsearch on their existing joint venture exploration licenses.

http://blogs.wsj.com/dealjournalaustralia/2012/11/01/bidding-war-for-acer-fizzles-fast/