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T&T Energy Company to gain in BG Group’s $13.8B Takeover Bid

UK's BG Group launched a hostile takeover bid on June 24, 2008 of A$13.8 billion (A=Australian dollars) (US$13.1 billion) for Australia's Origin Energy. BG Group is offering A$15.50 (US$14.75) a share cash offer to Origin's shareholders, the same offer that was rejected by Origin's board of directors last month after Santos sealed a deal with Malaysia's Petronas on the Gladstone LNG to develop its Bowen-Surat Basin CSG reserves.

Petronas offered more than US$2.5 billion to acquire 40 per cent of Gladstone LNG in a deal which Origin said raises the value of its Bowen Basin CSG assets. BG said the offer price represents a 48 % cash premium on Origin's closing price of A$10.47 (US$9.97) on April 29 just before it made the first approach to acquire the Australian energy group. This offer represented a "material premium" for Origin shareholders and reflected the value of Origin's energy business and its prospective coal seam gas (CSG) development.

Origin Energy Limited is a major Australian integrated energy company which was formed in February 2000 as a result of the demerger of Boral Limited an Australian conglomerate. Origin’s focus is in gas and oil exploration and production, energy retailing and power generation. They provide gas and electricity to more than 3 million consumers across Australia, New Zealand and the Pacific.

BG Trinidad and Tobago says it will acquire all of the company's issued shares at TT$15 dollar 50 cents cash per share; this would amount to TT$13.8 billion dollars. BG Group currently supplies gas to the domestic market and to Atlantic LNG primarily for export to North America; BG has been operating in Trinidad and Tobago as a major gas player since1989.

BG's Chief Executive Frank Chapman said, "Recent transactions, analyzed on a comparable basis, confirm that BG Group's offer provides full value to Origin's shareholders. Origin shareholders have limited visibility of the risks inherent in their current reserves position and liquefied natural gas (LNG) joint venture. "Today, Origin does not have sufficient CSG reserves for a LNG joint venture: there are third-party contractual rights over a large number of Origin's tenements that have not been adequately explained; and Origin's domestic market requirements from CSG exceed the company's current available proven reserves." Origin advised its shareholders to take no action in response to BG's takeover bid at present.

BG Group Plc (LSE: BG.) is an integrated oil and gas company which was created in 1997 when British Gas plc divested Centrica and was reorganized in 1999 as BG Group plc. BG Group has use of the trading name "British Gas" outside the United Kingdom.