Is Gina Rinehart’s 28c per share bid for Warrego Energy too good to refuse?

Nick Sundich, December 9, 2022

The race for Warrego Energy (ASX:WGO) has taken yet another twist with Beach Energy (ASX:BPT) withdrawing from the race. This followed Gina Rinehart making a better bid for the company that Beach was unwilling to match. So, is it a done deal now?

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Gina Rinehart’s bid for Warrego is enough to scare Beach away

Warrego Energy owns 50% of the West Erregulla onshore gas project in the Perth Basin. The other half belongs to Strike Energy (ASX:STX), which is the sole operator. After years of speculation that it would be acquired by Strike, Beach Energy (ASX:BPT) made an unexpected bid, only to be matched by Gina Rinehart.

And with Rinehart upping her bid at 28c per share (well ahead of Beach’s original 20c per share offer), Beach has withdrawn from the race. Warrego Energy told its shareholders to vote in favour of the new highest bidder – in absence of a superior proposal.

Is it all over now?

It would be difficult for another bidder to emerge, especially with the knowledge there would likely be a bidding war as has occurred with Beach.

However, Strike Energy told its own shareholders earlier this week that it had upped its stake in Warrego Energy to 19.9% and was ‘considering all available strategic options’. This may not mean that it will make its own bid (although it might).

But with a big ownership stake, it could yet have a major say in whether or not the deal is accepted by shareholders. So, stay tuned!