Magnum Hunter won't raise Ambassador offer

By Maggie Lu Yueyang

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


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