The new cash offer reflects both the higher price of Gloucester shares since Noble’s original cash offer back in March and the orders from the Takeovers Panel review last week, which effectively put the merger proposal back on the table.
Under the proposed merger, Whitehaven shareholders will receive one Gloucester share for every 2.45 Whitehaven shares they hold, while Gloucester shareholders will continue to hold their existing ordinary shares.
Noble, a 21.7% shareholder of Gloucester, has now taken the opportunity to call on Gloucester’s board of directors to exercise their fiduciary duty and consider its new cash offer as a superior proposal to the Whitehaven merger.
“Following the Takeovers Panel’s orders, the Whitehaven merger is conditional upon there being no superior proposal for the next 16 days only (until 21 May),” Noble said in a statement this morning.
An increase of $1.15 per share on its previous off-market cash takeover offer, Noble said the revised offer was at a 91% premium to the closing price of Gloucester on February 19 – the day before the initial merger announcement.
The Hong Kong-based commodities trader also said the deal was a 24% premium per Gloucester share as implied in the Whitehaven merger proposal as of yesterday’s trading price.
Noble argues that Gloucester shareholders cannot cash in on the deal unless the company’s directors terminate the Whitehaven merger proposal, which it has previously labelled as a reverse takeover of Gloucester.
“We believe the substantial uplift in our cash offer requires Gloucester’s board to now act in the interests of all Gloucester shareholders and declare Noble’s offer as superior to the Whitehaven merger immediately,” Noble Energy director Will Randall said.
“The clock is ticking on the Whitehaven merger, and only the Gloucester directors have the ability to stop that clock and give their shareholders the chance to review our generous cash offer.”
Under the rulings from the panel, the Whitehaven merger proposal is conditional on there being no superior offer emerging up to at least May 21.
After this date, Gloucester directors can waive this condition if they do not determine Noble’s offer as superior.
Gloucester said this morning it was currently considering the proposal and would respond in due course.
However, should Gloucester shares rise substantially Noble might be forced to up the offer a third time in order to make it superior.
Back in 2007, Noble and private mining group AMCI used their stakes to vote down a takeover offer by Xstrata Coal, despite the wishes of Gloucester’s board.
The merger between Gloucester and Whitehaven would create a $1.2 billion company that holds combined reserves of 190 million tonnes and resources of 922Mt with saleable production of 4.5Mt, as of calendar year 2008.
Gloucester shares are unchanged this morning at $5.41, while Whitehaven shares are up 7c to $2.04.