Armour says no to Landbridge

On Wednesday, Australian company Armour Energy rejected an AUD36.6-million ($25.8 million) takeover offer from the privately owned Chinese investment fund Landbridge Group.

“The offer does not reflect the current or potential value of Armour’s assets and comes at a time when the company is in the process of decisively rebuilding its business and in the context of increasing demand for gas in Australia,” Armour executive chairman Nicholas Mather announced to its shareholders. The offer, based on a value of AUD0.12 ($0.08) per share, was labelled “opportunistic.”
Armour had just signed a letter of intent with US company American Energy Partners for further development in northern Australia’s McArthur Basin. The letter outlined terms for a possible $100-million exploration programme. Landbridge’s takeover offer was conditional upon Armour dropping the deal with American Energy Partners.
Armour’s Glyde-1 exploration well in the McArthur Basin showed promise, testing at the equivalent of about 93,500 cubic metres (3.3 mcf) of gas per day. Landbridge is developing its interests in Australian shale, following its AUD200 million ($173 million) purchase of the Queensland gas producer the WestSide Corporation last November.
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