Geodynamics closer to complete takeover of KUTh Energy

Geodynamics closer to complete takeover of KUTh Energy Minister James Bule signs and hands over Production License to KUTh Managing Director David McDonald with Chief Ameara (Takara) in attendance (source: KUTh Energy)
Alexander Richter 5 Dec 2013

Geodynamics Ltd. reports it has secured a relevant interest of 86.06% of all ordinary shares in KUTh Energy, as part of its take-over offer of all shares in the company. It now announces an unconditional offer for the remaining shares held by KUTh Energy shareholders.

According to an announcement by Australian Geodynamics, the company is now making an unconditional off-market offer for shares in KUTh Energy Limited.

The offer is unconditional, based on the off-market take over bid for all of the shares in KUTh Energy under the bidder announcement earlier this year.

Geodynamics has today declared its Offers to be unconditional. This means that Geodynamics will acquire all of the KUTh shares for which it has received acceptances, and KUTh will become a subsidiary of Geodynamics.

The notice published now declares that the Offer has been freed from all defeating conditions, pursuant to section 650F(1)(a) of the Corporations Act.

Geodynamics notes that as at the date of this announcement, it has a relevant interest in 86.06% of all the ordinary shares in KUTh. Geodynamics also notes that KUTh directors and members of senior management have accepted Geodynamics’ Offer in respect of all KUTh shares they own or control.

The Geodynamics Board of Directors has undertaken a review of the status of the takeover bid, and advises that it has decided that Geodynamics will not increase the Offer consideration.

The following benefits are named by Geodynamics for current shareholders of “KUTh Energy:

  • The Offer represents a significant premium of 31.6% to KUTh’s closing Share price on 17 September 2013
  • Geodynamics is a more diversified company with a broader portfolio of projects and greater resources to manage both companies’ projects. 
  • Geodynamics is better placed to raise the substantial development capital required to develop KUTh’s projects. 
  • KUTh has modest cash reserves and is very likely to require a capital raising in the next year. If the Merger does not proceed, KUTh Shareholders face the prospect of significant dilution from future capital raisings to fund and develop its projects. 
  • If the Merger does not proceed, there is a significant risk that KUTh’s Share price will fall upon the lapsing of the Geodynamics Offer. 

The Offer is to close at 7.00pm (Sydney time) on 13 December 2013, unless extended or withdrawn.”

Source: Geodynamics (pdf)