Ophir Energy has confirmed it is interested in acquiring the entire issued and to be issued share capital of Salamander Energy.
The announcement by Ophir today follows a statement issued on October 27 by Salamander, in which the Asia-focused oil company said it had been approached by Ophir and, separately, by a consortium led by Compañía Española de Petróleos (“CEPSA”) and Jynwel Capital.
Ophir confirmed sending a letter to the Board of Salamander confirming the proposed terms of its possible share exchange offer for the entire issued and to be issued share capital of Salamander.
In a statement issued today Ophir has said it believes there is “compelling strategic logic for a combination of the two businesses that would substantially benefit the shareholders of both companies.”
“The combined business would have a strong balance sheet and enhanced operating capability in both Africa and South East Asia, with deep expertise across the key technical and commercial functions. The combined business, using Ophir’s exploration track record and financial strength and Salamander’s established Asian operating platform, would be well positioned to exploit the rich opportunity set that exists in the South East Asia region.
“A combination of Salamander and Ophir has the opportunity to accelerate exploration activity both in Block G4/50, Thailand and in the assets Ophir has recently acquired in Myanmar and Indonesia. The combination would give shareholders exposure to 21 production, development and exploration blocks in South East Asia, as well as Ophir’s extensive footprint in Africa,” Ophir’s statement reads.
Ophir further said: “Ophir will remain an exploration-led upstream company. By selectively re-investing cash flow from Salamander’s current production, Ophir plans to develop the combined business in order to generate material cash flow and funding towards Ophir’s proven business model, that of continued monetisation of exploration/appraisal success. “
There can be no certainty that an offer will be made or as to the terms of any such offer, should one be forthcoming, Ophir said, adding that a further announcement would be made as appropriate.
Salamander Energy, the targeted company, is an Asia-focused independent exploration & production company with a number of licences spread throughout Indonesia and Thailand.