Chinese Takeover 69 cents, page-10

That didn't take long !

China’s Fosun Group and Tamarind Energy were both understood to have been in the dataroom for the Roc Oil takeover.Photo: Robert Garvey
ANGELA MACDONALD-SMITH, SARAH THOMPSON AND GRETCHEN FRIEMANN
Roc Oil’s controversial $800 million zero-premium merger with Horizon has been knocked off course after Roc received a $474 million cash takeover from private Chinese conglomerate Fosun Group, which has been welcomed by Roc’s largest shareholder Allan Gray.
Allan Gray portfolio manager Simon Marais said on Monday he “would be supportive” of the all-cash offer, which is priced at 69¢-per-share and is conditional on just 50.01 per cent acceptances.
“This is a much better outcome” than the merger proposal with Horizon, Mr Marais said. “We are happy.”
Horizon shares slumped as much as 12.2 per cent in early trading on Monday to 32.5¢. Roc Oil shares, which closed on Friday at 63¢, had yet to trade.
The takeover offer comes after The Australian Financial Review’s Street Talk on Monday reported thatFosun and Tamarind Energy were both understood to be in the dataroom for the Roc takeover, but that Tamarind, which is backed by private equity group Blackstone, was wavering and set to withdraw.
Both names were previously foreshadowed by Street Talk.
“The proposal to purchase all of ROC’s shares for cash is superior when considered against the alternative merger of equals with Horizon and offers a significant premium to share price performance,” Roc chairman Mike Harding said.
He said the Fosun offer was a “low risk route to maximise immediate value for our shareholders.”
Fosun intends to use Roc, which has a number of Chinese oil and gas assets, as its entry-point into the oil and gas sector. It said the total consideration for the offer was $489 million.
Roc’s merger with Horizon was due to be voted on by Horizon shareholders on Thursday.
Under the terms of that deal Horizon has five days, or until Friday afternoon, to respond to the bid.
However, its depleted cash reserves, which were the primary driver of a union with Roc, means it would have difficulty coming up with the funding.
Instead, Fosun’s push for Roc leaves Horizon stranded and an obvious buy-out target.
The Australian Financial Review