Drillsearch takes bigger stake

Deal closes: Drillsearch wins

Australia’s Drillsearch Energy has nudged ahead of Magnum Hunter Resources to take over Ambassador Oil.

Drillsearch has completed the acquisition of more than 28 million shares, representing 19.5% of the total issued share capital in Ambassador.

The company agreed to pay Ambassador shareholders 1 share in Drillsearch for every 5.4 shares in Ambassador.

Last month Drillsearch launched a A$40 million (US$37.5 million) takeover of the company, with an implied value of $0.29 per Ambassador share.

The deal gives Ambassador shareholders exposure to the upside potential of the company’s assets to its shareholders.

It also gives shareholders exposure to a prolific oil business on the western flank of the Cooper basin.

Drillsearch said this deal consolidated the companies’ assets across the northern Cooper basin.

On Wednesday, US-based Magnum revealed it was making its own takeover offer for the company which would give Ambassador shares a value of $0.27 per share.

Magnum recently entered into the Cooper basin after gaining a majority stake in New Standard Energy as part of a wider deal.

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