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Oil Search rejects $8 billion takeover from Woodside Petroleum

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Staff writer ▼ | September 14, 2015
Oil Search
Acquisition   "The proposal is highly opportunistic"

Oil Search rejects an $8 billion takeover proposal from Australia's biggest energy company Woodside Petroleum.

The board has concluded that the proposal is highly opportunistic and grossly undervalues the company.

Clearly this proposal falls well short.
Rick Lee, chairman
"Since receiving the Proposal, the Company has undertaken substantial shareholder engagement. The overwhelming feedback has been that this Proposal has little merit," the company said in the statement.

Oil Search is in a very robust financial position, with strong operating cash flows from its producing assets, even at current low oil prices, and current liquidity of $1.6 billion, comprising $850 million in cash and $750 million in undrawn corporate credit facilities.

Chairman Rick Lee said: “The Board of Oil Search believes our Company is in a very strong position, both operationally and financially. We have a low cost, high quality, production base which is generating strong cash flows and excellent growth opportunities, with the proposed PNG LNG Train 3 and Papua LNG among the most competitive new developments in the world.

Oil Search provides its shareholders with a pure exposure to PNG and is fully committed to PNG. Our focus is on continuing to build and create shareholder value through the Company’s strong future growth prospects.

"If any proposals are tabled in the future that reflect compelling value for Oil Search shareholders, we will engage on them. Clearly this proposal falls well short of that test.”


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