Possible Takeover???, page-77

Private equity firms are expected to drive a wave of merger activity in Australia's gas sector, hunting for bargains amid soaring demand in China, rising domestic prices and a broader oil market recovery.
The energy sector has dominated Australian M&A activity over the past 12 months, led by a spurned $US10.8 billion ($14.54 billion) bid for oil and gas producer Santos and a $US9.8 billion ($13.19 billion) bid for pipeline operator APA Group by Hong Kong's CK Infrastructure.

Still, the share prices of smaller companies in the sector have yet to fully reflect the sharp recovery in oil markets over the past year and gains from lower drilling costs, say bankers and consultants.

Private equity firms clearly see strong turnaround opportunities in the oil and gas sector. Stocks are trading below their earnings potential with serious upside," said Perth-based Deloitte Consulting partner Bernadette Cullinane.

"Most of the sub-billion market cap companies with reasonable 2P resources and cash flow or near term cashflow would be attractive to private equity funds," said Eddie Rigg, head of corporate finance at Argonaut, who advised a private Chinese firm that lost out in a three-way bidding war for gas producer AWE in February.

https://www.acbr.com.au/all-about-gas-australia-primed-more-ma

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