WestSide in talks on potential rival takeover offer PUBLISHED: 5 hours 31 MINUTES AGO | UPDATE: 3 hours 49 MINUTES AGO
Angela Macdonald-Smith Queensland coal seam gas player WestSide Corporation has signalled it is in talks about a potential takeover offer that would trump the $178 million bid it has received from China’s Landbridge, which it describes as “inadequate, unsolicited and opportunistic”.
In its target’s statement released on Friday, WestSide told shareholders they should reject Landbridge’s 40¢ a share offer, advising that they “may lose the chance to later accept a competing offer”.
“Your board is seeking to test whether an alternative offer that recognises your board’s view of the full value of WestSide can be put to shareholders,” it said.
“A number of parties are currently in discussions with the board, which may result in an alternative offer being made for the company either during the course of the Landbridge offer or at some time in the future.
“Accepting the Landbridge offer means you may not be in a position to participate in any possible competing proposals from third parties.”
WestSide shares rose 0.5¢ or 1.3 per cent to 39¢.
Landbridge, a privately owned port operator in China, has already received acceptances for its offer from three of WestSide’s top 10 shareholders, after increasing its offer last month. It has received acceptances from Energy Infrastructure Trust, as well as from WestSide founder and former chairman Angus Karoll, and from the Mitchell family, which runs a drilling business in Queensland.
The Chinese player has as a result become its target’s largest shareholder, with 19.9 per cent, more than New Hope Corporation’s 17.6 per cent.
But WestSide chairman Robert Neale told shareholders in the target’s statement that Landbridge’s offer “fails to adequately recognise WestSide’s unique position as a company with producing assets, substantial existing infrastructure with unutilised capacity, a binding 20-year gas sale agreement and significant additional uncommitted reserves”.
WestSide, which is being advised by Highbury Partnership, recently signed a 20-year gas sales agreement with Santos’s GLNG venture for the sale of gas from its Meridian SeamGas venture west of Gladstone.
WCL Price at posting:
41.0¢ Sentiment: Hold Disclosure: Held
