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Highlights
- Strike Energy joins hands with Warrego Energy at an agreed merger ratio.
- The Strike shareholders will acquire 72% of Warrego Energy at a share exchange rate of 0.7750.
- Under the agreement terms, Warrego shareholders will receive the full value of its Spanish assets.
Australian low-carbon energy business Strike Energy Limited (ASX:STX) stated in the official ASX release that it has entered into a merger with Warrego Energy Limited (ASX:WGO) on 10 November 2022.
Strike Energy has been eyeing this merger since 16 September, when the company first submitted a confidential, non-binding indicative all-scrip merger proposal (Initial Merger Proposal) to the board of Warrego Energy. The proposal stated Warrego shareholders receiving 0.7142 Strike shares in turn for each Warrego they hold on to a pro-rata basis.
The proposal was revised (Revised Merger Proposal) later on 16 October, according to which shareholders of Warrego will receive 0.7521 Strike shares for each Warrego share they own.
Finally, on 27 October, the Warrego board confirmed the merger between the two companies, in which Strike shares will be offered to Warrego shareholders at a share exchange rate of 0.7750.
Warrego holders would also be entitled to receive the full value of the next-generation energy business’ Spanish assets. This transaction would occur via distributing the net proceeds generated through selling Warrego’s Spanish assets.
Key details of the merger
- Under the terms of revised merger proposal, Strike would be obligated to appoint one Warrego nominee director to the board of the merged business once the scheme came to its closure.
- The scheme is being generated at an agreed merger ratio by both entities.
- The confirmation of this merger by the Warrego board was subject to the signing of legally binding deal contracts, confirmatory due diligence, and usual fiduciary outs.
- After conducting confirmatory due diligence and negotiating suitable binding deal documents, it was decided under a confidentiality agreement that Strike Energy would hold 72% of Warrego Energy, including its current 7.6% stake in Warrego.
- Warrego shareholders will hold the remaining 28%.
- Warrego shareholders receiving the full value of Warrego’s Spanish assets with a transaction price of AU$0.186 per share was determined by the agreed merger ratio based on Strike’s 30-day VWAP (volume-weighted average price) as of 27 October 2022.
Commenting on the merger, Strike Energy said:
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Data Source: Company announcement dated 10 Novemner 2022
