Drillsearch & Great Artesian merger

Drillsearch Energy Ltd and Great Artesian Oil and Gas Ltd have announced...

  Drillsearch Energy Ltd and Great Artesian Oil and Gas Ltd have announced an agreed merger which will result in the creation of a mid-tier Australasian oil and gas exploration and production company, with significant growth potential, strong management and a capacity to achieve its goals.The merger will be implemented by way of a Scheme of Arrangement with Great Artesian shareholders to receive 3 Drillsearch shares for each 1 Great Artesian share they own. Great Artesian will seek a Court order to convene a Great Artesian shareholder meeting, expected to be in early July 2008, to approve the Scheme. The Directors of Great Artesian unanimously recommend the Scheme as in the best interests of Great Artesian shareholders, in the absence of a superior proposal and subject to the independent expert concluding that the Scheme is in the best interests of Great Artesian shareholders. Following the merger, the new Board will review whether the current name of Drillsearch reflects its new business plan and ambitions and may seek shareholder approval to rename the company. The merged company will remain headquartered in Sydney.Peter Simpson, the Executive Chairman of Drillsearch will remain as Chairman of Drillsearch but in a non-executive capacity. David Williams, the recently appointed Managing Director of Great Artesian, will be appointed as the Managing Director of the merged entity. Peter Simpson stated that, “this is a true merger. The merged company will benefit greatly from its enhanced market position, its strong management team and a debt free balance sheet with cash of over $8million.”Commenting on the combined group’s asset portfolio, he said, “the Tintaburra and Naccowlah production assets will be balanced with a complementary set of highly prospective exploration and development assets, including the Great Artesian “Green” Cooper Basin Gas Commercialisation Project, the Marina 2 prospect in the Bonaparte Basin (offshore, WA) and the synergistic Cooper/Eromanga and Surat Basin exploration permits held by each of the merging companies.” Management and staff from both companies will combine to form an experienced, fully resourced oil and gas team with exploration, development, production and operator capability. As part of the merger terms, David Williams will immediately be seconded part-time to Drillsearch, to help ensure a rapid integration on completion of the merger. Commenting on the combined group’s management team and prospects, David Williams said, “I am excited by the team that will come together as part of this merger. This provides us with a very capable and focussed team with a wealth of experience across the combined business. There is a real enthusiasm from everyone for the merger and an atmosphere that we can build on effectively. The Boards of both companies have recognised the need to grow and what is required to execute this merger successfully. There has been a common purpose – to restore and grow shareholder value. The Great Artesian Board determined that we must grow, but grow in a prudent manner. This merger demonstrates our joint ability to deliver on that statement.”