Page 14 - AsianOil Week 16 2021

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FAR receives another takeover

offer from Remus Horizons

FINANCE & REMUS Horizons, a private investment fund,
INVESTMENT has submitted a new takeover offer for Australia’s
FAR Ltd, a minority shareholder in the Sango-
mar block offshore Senegal.
FAR received the off-market proposal from
Remus on April 14, one day before a scheduled
general meeting of shareholders. The top item
on the agenda for that meeting was a vote on the
company’s plan to sell its minority stake in San-
gomar to Woodside Energy, the Australian firm
that operates the joint venture set up to develop
the block. However, shareholders voted on April
15 to give themselves time to consider the new
takeover bid. They approved a motion to adjourn
the meeting and reconvene on April 28.
According to a company statement, Remus
has offered to buy 100% of shares in the Austral-
ian company at a price of AUD0.021 per share,
or AUD209.6mn ($162mn) in total. This offer is
“conditional only on shareholders rejecting the
sale of FAR’s interest in the RSSD project and the
FAR directors confirming that there is no inten-
tion to dispose of this interest prior to the closing
of the takeover offer,” the statement said.
These appear to be the same terms that the
investment fund proposed last November, when
it submitted a non-binding proposal for the pur-
chase of FAR.
FAR did not say whether Remus’ new offer
would have any effect on its own position. The
Australian company has indicated previously FAR received another non-binding take-
that it favours the sale of its RSSD stake to over proposal from Russia’s Lukoil earlier
Woodside, which is already the majority owner this year. However, the privately owned
of the joint venture. Russian major decided recently not to go
Even so, Remus has argued that its proposal is forward with the bid.
the better option. In a letter outlining the terms For its part, Woodside has offered to buy
of its bid, it said that its offer of AUD0.021 per FAR’s stake in RSSD on the same terms as
share “represents approximately 23% more than those proposed last November by ONGC
the cash backing of AUD0.0171 per share that Videsh Vankorneft, a subsidiary of India’s
would exist” in the event that FAR proceeded ONGC Videsh Ltd (OVL), and it formalised
with the sale to Woodside. the plan in January of this year by signing a
It also said: “The Remus offer provides a route sales and purchase agreement (SPA) with FAR.
whereby shareholders may exit their investment The SPA sets the price for FAR’s stake in RSSD
for cash at a price [that] represents superior value at $45mn plus reimbursement for FAR’s share
compared with remaining a shareholder and of working capital in the project, including
should be seen as attractive when considered in cash calls, between January 1, 2020 and the
the context of the significant risks and uncertain- date the transaction is concluded, along with
ties of remaining a shareholder.” the right to collect certain contingent pay-
It listed these risks as: the inability to sell shares ments in the future.
in FAR, so long as that company’s shares remain RSSD’s licence area includes three separate
suspended from quotation on the ASX; FAR’s fields – Rufisque, Sangomar Offshore and Sango-
plan to use the proceeds of the sale to Woodside to mar Deep Offshore, which give the joint venture
rebuild itself and to invest other West African pro- its name. Oil was discovered at the block in 2014,
jects with an uncertain value proposition; the risk and the joint venture has estimated that it con-
that FAR’s shares may starts trading below the level tains 645mn barrels of oil equivalent in recover-
of AUD0.0171 per share if the sale to Woodside able reserves, including 485mn barrels of crude
goes ahead, and the lack of an alternative takeover oil and 160mn boe of natural gas. Woodside
offer for FAR by any other party. hopes to begin production in 2023.™

P14 www. NEWSBASE .com Week 16 22•April•2021