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"Molopo's takeover concerns

MOLOPO Energy has raised significant concerns about a proposed takeover bid being threatened by significant shareholder Aurora Funds Management.

Aurora said in July it intended to make an 18c per share offer in cash, capped to $5 million, backed by units in its unlisted Aurora Fortitude Absolute Return Fund scheme.

Molopo said no valuation for the AFARF units had been disclosed, but warned any shareholders tempted to take up the offer that its redemption guidelines restrict the redemption of units to 5% of total funds on management in any given quarter, and that could pose a significant liquidity risk for Molopo's shareholders.

It has also warned of "fundamental and threshold legal problems" with Aurora's intended bid, in the wake of a ruling by the Takeovers Panel that found Aurora and another major shareholder, Keybridge Capital, had been undeclared associates since 2016 and had breached the corporations law by failing to disclose that fact.

They have both been limited in their ability to buy more Molopo shares acquisitions for six months from July 7, and they were forced to vest shares equivalent to 17.5% of shares with ASIC for sale.

Molopo said Aurora had failed to disclose critical facts in making its intention to bid, and that it would contravene the acquisition restriction order by making its intended takeover bid.

Aurora needs to make a concrete move on Molopo by September 27 under the law.

Molopo has raised the issues with the Takeovers Panel and ASIC, and said a key defeating condition were triggered two days after Aurora flagged its intentions by Molopo's $8.75 million US farm-in deal.

Molopo has warned shareholders to take no action while it continues to investigate Aurora's "reckless" moves.

The company is in the midst of getting involved in a new oil and gas exploration project along Florida's Sunniland trend (25% working interest).

Molopo's move into Florida involves it taking a 50% interest in Orient FRC, a company with a right to earn 50% into leases in Florida by funding three wells with Kerogen Florida Energy Company (50%).

The first well is planned for May 2018, with the final two wells planned within a 12 month window.

Each well is expected to cost around $3.2 million.

The project contains 2C contingent reserves of 12.3MMbbl (gross) with upside to almost 21MMbbl.

If the first well disappoints, Orient has the option of forfeit its rights and pulling out.

Molopo shares remain suspended from trading."