Upstream article below - let's hope re-consideration by MEO's board of MOGs offer is just a formality. Would have preferred a continued stance by MEO of MOG's offer as 'inferior'. Nothing has changed re the negatives of MOG offer identified by MEO board so why the need to re-consider - creates uncertainty...
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Neon calls off MEO merger
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Josh Lewis
22 December 2014 01:56 GMT
Australia's Neon Energy has called off a merger with compatriot MEO Australia after a superior offer was received from existing shareholder Evoworld.
Neon revealed on Monday it had terminated
its merger implementation agreement with MEO after Evoworld agreed to make a proportional off-market takeover offer of 50% of the ordinary shares in Neon it does not already hold.
The bid will see Evoworld, which already holds a 19.99% interest in Neon, offer shareholders A$0.038 (US$0.031) per share for 50% of their holding, up from its previous offer of A$0.035 per share for 30% of the shares it did not already own.
Neon shareholders
overwhelmingly shot down Evoworld's previous offer at a general meeting last month, with 93.85% of those who voted against the proportionate takeover and only 6.15% for the deal.
“Having carefully considered the terms of Evoworld’s proposal, the board of Neon have unanimously determined that the offer constitutes a superior proposal to the merger with MEO Australia,” Neon said in a statement on Monday.
“Accordingly, the board has resolved to recommend the offer to Neon shareholders, in the absence of a superior proposal and subject to an independent expert concluding that the offer is fair and reasonable (or at least not fair but reasonable) to non-associated Neon shareholders.”
Neon also revealed that Evoworld had agreed to dismiss
the proceedings it commenced last week in the Supreme Court of Western Australia in relation to the validity of voting at last month's general meeting.
It added it had agreed to appoint Evoworld nominees Timothy Kestell and Peter Pynes to the board as non-executive directors in recognition of the latter's existing stake in Neon, with John Lander stepping down from the board.
Neon also stated that once Evoworld's stake in the company increases to 30% and the offer becomes unconditional, Ken Charsinsky will resign from the board and Ross Williams will be appointed as a non-executive director.
In a separate statement on Monday, MEO said it considered the notice to terminate the merger to be valid, subject to it receiving a A$400,000 reimbursement fee from Neon.
As a result of the merger falling through, MEO said it expected Mosman Oil & Gas to proceed with its intention to make an off-market takeover for the company.
London-listed Mosman
launched an all share offer earlier this month, offering one of its shares for every 20 MEO shareholders own.
MEO
labelled the offer as “inferior” last week, saying it represented an implied value of roughly A$0.0165, which was a discount of about 13.1% to the last traded price of MEO shares at the time.
However, with the Neon merger now off the table it appears MEO's board is willing to consider Mosman's offer.
“The board of MEO will consider its opinion on the Mosman proposal in light of the potential termination of the merger implementation agreement with Neon,” it said on Monday.
“Shareholders are advised to take no action in relation to the Mosman proposal or any document received from Mosman until they receive the MEO directors’formal recommendation regarding the Mosman proposal.”
