Magnum said it had based its offer for Ambassador largely on the opportunity to increase its exposure to Cooper Basin exploration. Ambassador owns a 47. 5 per cent interest in the Cooper Basin exploration permit PEL 570.
Shares in Ambassador Oil & Gas slumped almost 6 per cent after its suitor, US shale company Magnum Hunter Resources, said it would not raise its takeover offer.
That brought Magnum into a bidding battle with Drillsearch Energy, which had offered one Drillsearch share for every 5. 4 of Ambassador shares earlier and valued the company at $48m.
In June, Magnum raised its bid by offering one share of Magnum share for every 23. 6 Ambassador shares, representing 38 cents per Ambassador share at that time and valuing the company at $54 million.
However, an immediate acquisition of Ambassador became less attractive after the South Australian state regulator recently postponed the exploration obligations under PEL 570, said Magnum.
Read more here: Business Spectator