7th Oct 2015 06:48
LONDON (Alliance News) - Nostrum Oil and Gas PLC on Wednesday said it has withdrawn its proposed offer for Tethys Petroleum Ltd after Tethys' largest shareholder said it did not support the deal, but Nostrum said it reserves the right to propose alternative deals to Tethys.
In late September, the pair had agreed headline terms whereby FTSE 250-listed Nostrum was set to acquire Tethys for CAD0.147 per Tethys share, which was set to be satisfied by the issue of shares in Nostrum. Nostrum also agreed to supply Tethys with USD20.0 million in interim funding to Tethys' subsidiary, Tethys Kazakhstan SA.
However, on Wednesday, which was the date the exclusivity period between the pair expired, Nostrum said it had stressed the deal was conditional on Tethys' three largest shareholders agreeing to the deal.
"Tethys' largest shareholder, Pope Asset Management LLC, has informed Nostrum that it does not support the proposed offer and therefore, despite the progress made by Nostrum and Tethys in preparing transaction documentation, the proposed transaction will not proceed," Nostrum said in a statement.
In September, Nostrum had said it was confident in reaching a deal with Tethys in the near future, with hopes of completing a deal before the end of 2015.
It also said Wednesday the USD20.0 million interim funding that was set to be provided to Tethys from Nostrum has also been withdrawn. However, Nostrum has hinted that it may not be the end of talks between the companies.
"Nostrum reserves the right to propose alternative transactions to Tethys and/or to make an offer for the share capital of Tethys on different terms to those previously announced," said Nostrum Wednesday.
It had previously made an offer of CAD0.2185 per share back in August, and later that month said it would be prepared to make an offer at CAD0.147 per share, the same price as agreed in September. It had lowered its potential offer following due diligence, it said, and in light of the recent devaluation of the Kazakh tenge and change in macro-economic conditions.
By Joshua Warner; [email protected]; @JoshAlliance
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