Woodside said on Dec. 8 it had informed Oil Search’s board that it had withdrawn its proposal to merge the companies. The company added that it was not pursuing any alternative transactions to combine the firms.
Oil Search had rejected the bid (a 1-4 scrip deal) soon after it was made, but Woodside’s Chief Executive Officer Peter Coleman had continued to have talks with the Papua New Guinea government, which owns 10% of Oil Search, in the following weeks (OGJ Online, Sept. 14, 2015).
It is believed that the government rebuffed these overtures, saying that only a cash offer would be acceptable and that the price of such an offer would need to be well over the government’s entry price into Oil Search last year of $8.20 (Aus.)/share. Woodside’s scrip offer was originally worth $7.65 (Aus.)/share.
Analysts now expect Woodside to look elsewhere for assets to acquire.