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Oil & Gas

POSCO International seeks to buy Australian gas producer Senex

Makes $603.5 million takeover offer, but Sensex wants more

By Oct 18, 2021 (Gmt+09:00)

Senex’s Roma North natural gas development in the Surat Basin, eastern Australia (Courtesy of Senex)
Senex’s Roma North natural gas development in the Surat Basin, eastern Australia (Courtesy of Senex)
POSCO International Co. is seeking to acquire Australian coal seam gas producer Senex Energy Ltd., as the trading unit of South Korean steelmaker POSCO Co. is looking for future growth engines in other countries.

Senex said on Oct. 18 POSCO International has made a takeover offer of A$815 million ($603.5 million) or A$4.40 per share. The offer represents a 15% premium over Senex's share price close on Oct. 15.

“On 2 September 2021, POSCO International submitted a revised non-binding and indicative proposal to acquire 100% of Senex for a cash offer price of A$4.40 per share,” Senex said in a filing to the Australian Securities Exchange.

POSCO International initially made its approach on July 30 with a bid of A$4 per share, raising it around a month later to A$4.20 a share on Aug. 27 and then lifting it again in September, according to the filing.

SENEX WANTS A HIGHER OFFER

Senex has now agreed to give POSCO International exclusive access to its books until Nov. 5 to give POSCO International more time to assess a revised proposal price higher than A$4.40 per share.

A POSCO International source said the company is considering various ways to acquire Senex although it has yet to make a final decision.

Senex is engaged in gas and oil exploration, crude oil production, as well as the oil pipeline transportation business.

Senex is a rapidly growing gas producer supplying Australia's east coast market, where prices have more than doubled over the past six years following the start of liquefied natural gas (LNG) exports from Queensland state, according to a Reuters report on Oct. 18.

POSCO International plans to secure future business for the POSCO Group with resource development, one of the group's three target growth engines, including steel and food.

The company is already seeking major oil and gas exploration in Indonesia, Malaysia and Myanmar.

“We will grow into a global comprehensive business company that can flexibly respond to changes in the industrial paradigm by building a balanced business portfolio,” said POSCO International President Joo Si-bo.

Write to Kyung-Min Kang at kkm1026@hankyung.com

Jongwoo Cheon edited this article.

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