AOG accepts Ensign's higher comeback offer

Just one week after accepting the rival bid of Precision Drilling, the board of Australian Oil & Gas has recommended shareholders accept Ensign Resources' revised, two-stage higher offer.

The revised offer would see AOG shareholders receive $2.30 per share and $1.20 for each option. However, if more than 50 per cent of shareholders accept the offer by 13 June, the offer would increase to $2.40 per share and $1.20 per option, which values AOG at about $156 million.

Last week, the Australian subsidiary of the Canadian firm Precision Drilling Canada - Precision Australia - offered $2.25 for each AOG share and $1.05 for each option, which valued AOG at approximately $144 million.

An independent expert last month valued AOG's shares between $2.40 to $2.65 and AOG's options between $1.20 to $1.45. The midpoints of these ranges are $2.35 and $1.33, which were significantly higher than Ensign's original offer of $1.70 and $0.50.

Today AOG shares are trading at $2.40, up 10 cents on yesterday's trading.