22/10/2007 - 14:25

Gippsland scraps $25m Finder Exploration purchase

22/10/2007 - 14:25

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Oil explorer Gippsland Offshore Petroleum Ltd Ltd has scrapped the planned $25 million acquisition of West Perth-based Finder Exploration Pty Ltd after it was unable to reach agreement with the vendors of Finder.

Gippsland scraps $25m Finder Exploration purchase

Oil explorer Gippsland Offshore Petroleum Ltd Ltd has scrapped the planned $25 million acquisition of West Perth-based Finder Exploration Pty Ltd after it was unable to reach agreement with the vendors of Finder.

Melbourne-based Gippsland announced the planned acquisition on 27 August, when it highlighted Finder's interest in a prospective Browse Basin exploration permit.

It said today that the Finder vendors have been unable to satisfy its detailed due diligence process and had attempted to negotiate a significant increase in the purchase price.

This is a big change from August, when Gippsland said that Finder's directors had unanimously accepted the proposal.

Finder is a private oil exploration company founded in late 2005 by two of the original partners in Seismic Australia, Jan Ostby and Odd Arne Larsen.

Seismic was acquired in 2000 by Dutch company Fugro, which has since become a shareholder in Finder.

Finder's directors issued their own statement in August supporting the Gippsland deal.

"We have for several months been reviewing our strategy for growth and the future direction of the company," the directors said.

"During this process we considered a number of options and welcome the opportunity to join forces with GOP.

"A key driver in the decision making process for Finder was to be part of a company that by virtue of size and experience can evolve into a significant player in the oil industry in the next few years and believe that the
synergy with GOP will enable this growth.

"The key people of Finder are, and will continue to be, a very proactive exploration team in the development and capture of opportunities."

 

A Gippsland statement is pasted below:

Gippsland Offshore Petroleum Limited has decided not to proceed with a proposed takeover of Finder
Exploration Pty Ltd (Finder) initially announced to the market on August 27 this year.

After an extended period of due diligence and despite multiple attempts to conclude the transaction with
the vendors of Finder (Longreach Pty Ltd of Perth and Fugro NL, a Netherlands based international oil and
gas industry service company) no suitable deal could be reached.

The vendors of Finder originally agreed in principle to accept a $25 million takeover offer by Gippsland
Offshore Petroleum Limited and a subsequent announcement to the ASX was agreed and approved by all
parties.

Since this in principle agreement was reached, the Finder vendors have been unable to satisfy our detailed
due diligence process and furthermore have attempted to negotiate a significant increase in purchase
price.

Against this background and after a sustained attempt to reach a new agreement Gippsland Offshore has
decided it is not in the best interests of shareholders to further pursue this takeover.

Gippsland Offshore will continue to seek other opportunities for growth that represent excellent
opportunities for our shareholders.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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