todays australian

On Tuesday, Drillsearch said that the meeting would be adjourned from June 10 to July 31 because the board had agreed to a renewal process.

Simpson disclosed that he would be departing and the board would be reconstituted to four including a new chairman, the new managing director Brad Lingo and two new non-executive directors.

It turns out that Choo and McKerlie did not agree to either the proposed adjournment of the meeting or the board renewal process outlined by Drillsearch. Moreover, there may be dispute over the intention to adjourn the meeting.

McKerlie and Choo are said to have considerable shareholder support for the move to unseat the other three directors, but Drillsearch maintains Simpson, as chair of the meeting, can adjourn the meeting without having to put it to the shareholders for a vote. However, such a move would need to be in the best interests of the company and its shareholders, and would raise director's duties issues.

Meanwhile, Drillsearch is pressing on with a bid for 3D Oil, which does not have unanimous board support, and is itself the subject of a takeover bid from Beach Petroleum, conditional on no shares being issued in relation to the 3D bid.

The Drillsearch bid has been extended two weeks to June 9, to allow holders of 37 per cent of 3D which came out of escrow last week to consider whether or not to accept. Drillsearch has 31 per cent of 3D and needs at least 50.1 per cent to declare its bid unconditional. However, of the escrowed shares, a parcel of 18 per cent is held by 3D managing director Noel Newell, who has said he won't accept. 3D is confident that holders of the majority of the other escrowed shares won't accept and, if so, Drillsearch would face an uphill battle.

It's suggested that some 3D holders who have accepted the Drillsearch offer did so in the belief that Beach would waive its condition relating to the 3D offer and they would be able to "double dip" -- accept the Drillsearch scrip offer and then accept the Beach scrip offer for Drillsearch. However, Beach yesterday made a "truth in takeovers" statement that it won't waive the condition and that if Drillsearch issues any shares in relation to the 3D bid then Beach's offer for Drillsearch "will not be consummated".

It remains to be seen whether that will cause some 3D holders to withdraw their acceptances to the Drillsearch offer.