Share
ASX-listed gas play Empire Energy will double down on its efforts in Northern Territory’s Beetaloo Basin after winning an auction to buy Paul Fudge’s Pangaea.
Street Talk can reveal Empire Energy will pay about $70 million for Fudge’s 82.5 per cent stake in Pangaea resource base, in a cash and scrip deal to be announced on Wednesday.
The Australian government is handing out grants to encourage exploration in Northern Territory’s Beetaloo Basin. Supplied
The offer will be funded with a $30 million equity raising arranged by Morgans and Blue Ocean. Empire Energy was advised by David Wood’s amicaa, while Morgan Stanley ran the auction for Pangaea.
Empire Energy shares went into a trading halt ahead of the raising. The company and its advisers have already lined up a handful of institutions to cornerstone the offer.
The deal is expected to see Pangaea’s Fudge, a well known Australian gas sector executive and dealmaker, emerge with about a 30 per cent stake in Empire Energy and a board seat. RELATED QUOTES EEGEmpire Energy Group
$0.355 1.43% 1 year1 day
Apr 20Oct 20Apr 210.1400.2800.420
Advertisement
It’s a big win for Empire Energy, which will increase its best estimate prospective gas resource by 157 per cent.
The company will pay $5 million cash, give Pangaea about a 30 per cent interest in the combined businesss and 8 million options with a 70¢ exercise price.
The remaining 17.5 per cent of Pangaea is owned by Houston-based Energy and Minerals Group. Empire Energy is expected to seek to also acquire that stake.
more to come
AJQ Price at posting:
3.1¢ Sentiment: Buy Disclosure: Held
