The tussle for Warrego Energy (ASX:WGO) has ended with Strike Energy (ASX:STX) accepting Hancock Energy’s 36c per share takeover offer for its West Erregulla gas field partner.

Strike had been hopeful that its offer of one STX share for every WGO share would be sufficiently attractive to shareholders, however, the point became rather moot after Gina Rinehart’s company secured acceptances for more than 50% of Warrego’s shares.

It’s not all negative for Strike though…


Strike still a winner

While it has not achieved its goal of acquiring Warrego, the company currently holds or controls 322,570,890 WGO shares (25.99% voting power), meaning that it will be in line for a fairly hefty payment of $116m.

Furthermore, its one-for-one takeover offer was enough to drive counterparty offers from 20c per share (Beach Energy) to 36c per share (Hancock’s current offer).

It also implies that Strike’s shares are worth at least the same amount, which is a 40% increase from its share price of 25.5c when it launched its initial takeover proposal in Hancock in September 2022.

This is more or less held up by the market given that shares in the company are currently priced at 36c.

Adding further interest, the company noted in its seventh (and final) supplementary bidder’s statement that Hancock’s acquisition of Warrego meant the introduction of a ‘well-credentialled, well-funded and motivated counterparty’ to pursue the development of West Erregulla.

Strike has plans to develop its exciting West Erregulla field as a domestic gas project at the Mid West Low Carbon Manufacturing Precinct as well as a 1.4Mtpa low carbon urea fertiliser development – Project Haber – at the same precinct that will use gas from West Erregulla as feedstock.