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Petroz recommends Italian takeover bid

By Phil Boeyen, ShareChat Business News Editor

Thursday 16th November 2000

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The ongoing battle for control of Australian gas and oil explorer Petroz has taken another turn, with the company recommending a cash takeover at A56 cents a share by Italian energy company Eni.

Eni, which has a market cap of Euro 54.7 billion and is one of the world's largest energy companies, currently owns 7.6% of Petroz, and its takeover offer values the company at A$126.7 million.

Petroz' board says the offer is 75% higher than the Petroz share price on the 19th of July, when the company announced its original recapitalisation proposal involving Fletcher Challenge Energy.

It is also at 20% premium to the current Novus takeover offer of 1 Novus share for every 3.75 Petroz shares, based on Novus' closing share price on 15 November 2000, and 19% higher than Petroz' closing price yesterday.

Petroz says in order to allow shareholders to consider Eni's cash takeover offer it is deferring a planned rights issue, although the rights issue could be back on the cards if the Eni bid is not declared unconditional by the end of January.

Petroz chairman, Harvey Parker, says the takeover offer is being recommended in the best interests of shareholders.

"The offer is considered by the Board to represent a fair outcome for Petroz shareholders, even though the offer price falls just short of the valuation range of A$0.58 - A$0.74 attributed to Petroz shares in the recent Independent Expert's report by Grant Samuel."

Eni has also entered into a Pre-Bid Acceptance Agreement with Guinness Peat Group in respect of a further 4.37% of Petroz' issued capital. Under this agreement GPG has agreed to accept the takeover offer for these shares when it is declared unconditional.

In October a placement and rights issue by Fletcher Challenge Energy in Petroz was rejected by shareholders. Fletcher Energy holds a 13% stake in the company.

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