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Horizon’s largest shareholder backs A$800 million Roc merger

JAMES PATON

SYDNEY, Australia (Bloomberg) -- Horizon Oil Ltd.’s largest shareholder, IMC Investments Ltd., supports the Australian explorer’s plans to combine with Roc Oil Co., saying an A$800 million ($750 million) company would draw more Asian investors.

“IMC believes the merger is a compelling proposition,” the Singapore-based investor said in a statement provided to Bloomberg News. “The combined entity will have the requisite profile to attract a strong Asian investor base, with its growth potential, scale, liquidity and geographic focus.”

Horizon holders are scheduled to vote Aug. 7 on the Roc deal that would merge assets stretching from China to Malaysia. Roc, which owns stakes in projects backed by PetroChina Co. and Cnooc Ltd., has received two approaches from potential buyers it didn’t name, potentially complicating the merger proposal.

“With every day that passes, it would seem less likely that a compelling and condition-light offer will eventuate” for Roc, IMC Managing Director Michael Chye said in an email. “However, it still remains a possibility.”

Roc rose 1.7% to 60.5 cents in Sydney trading, the highest in almost five weeks, while Horizon was unchanged at 37.5 cents. The benchmark index climbed 0.6%.

Horizon’s assets in Papua New Guinea, an emerging LNG hub, add to the merged company’s appeal, said Chye, whose company has been a shareholder for more than eight years. Austral-Asia Energy Pty, a unit of IMC, owns almost 25% of Horizon, according to a company statement.

“Should the merger not proceed, it would not change IMC’s view of the long-term value of the Horizon asset portfolio,” Chye said in the email.

07/30/2014

 

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