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Proposed Acquisition of SINO Gas by Lone Star

Source: www.gulfoilandgas.com 5/31/2018, Location: Asia

Sino Gas & Energy Holdings Limited (Sino Gas) has entered into a Scheme Implementation Agreement with a wholly owned subsidiary of Lone Star Fund X Acquisitions, LLC (together with its affiliates, “Lone Star”) under which Lone Star proposes to acquire 100% of the issued share capital of Sino Gas by way of a scheme of arrangement (the “Scheme”).

Under the terms of the Scheme, Sino Gas shareholders will receive cash consideration of A $0.25 per Sino Gas share, subject to all applicable conditions being satisfied or waived and the Scheme being implemented.

The Scheme consideration at A$0.25 per share values Sino Gas at a market capitalisation of A$530 million. This represents an attractive premium of:
• 19% to closing price of A$0.21 per share on 30 May 2018
• 32% to 1 month VWAP of A$0.19 per share up to and including 30 May 2018
• 39% to 3 month VWAP of A$0.18 per share up to and including 30 May 2018
• 47% to 6 month VWAP of A$0.17 per share up to and including 30 May 2018 Lone

Star is a private equity firm that invests globally in a range of different assets classes, including the oil and gas industry. Since inception in 1995, Lone Star has organised seventeen private equity funds with aggregate capital commitments totalling over US$70 billion. Funding for this acquisition is being provided by affiliates of Loan Star Fund X (U.S.), L.P. and Loan Star Fund X (Bermuda) L.P., which closed in November 2016 with a US$5.5 billion capital commitment.

The Scheme is not subject to any funding condition. Board recommendation The Sino Gas Directors unanimously recommend that Sino Gas shareholders vote in favour of the scheme, in the absence of a superior proposal and subject to the Independent Expert concluding that the Scheme is in the best interests of Sino Gas shareholders.

Commenting on the scheme, Sino Gas’ Managing Director Glenn Corrie said "The 100% cash consideration represents an attractive premium to recent trading prices, and provides certainty of value for Sino shareholders.

While the Sino Gas Directors remain of the view that the business and assets have significant potential, they acknowledge that the cash consideration provides shareholders with cash certain value now versus the future risks and uncertainties associated with the business.”

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Related Categories: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 

Related Articles: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Insurance  Investment  Mergers and Acquisitions  Risk Management 


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