Ensign Resource Service Group has increased its stake in Australian Oil and Gas Corp Ltd to 23 percent. Ensign has acquired Downer EDI Ltd's 6.8 percent interest in the company after increasing its takeover offer for AOG to A$2.60 cash from A$2.30 for each share and to A$1.40 from A$1.10 for each AOG option. If the company obtains more than 50 percent of AOG's shares before the closing date of July 11 then it will increase its offer again to A$2.70 per share and A$1.50 per option, valuing the company at A$175 million (US$99 million).
The increased bid tops two rival bids from Parker Drilling Co and Precision Drilling Corp. Industry sources said the future of AOG now lies in the hands of the major shareholders, U.S.-based investment company Pico Holdings, which has 23 percent, and funds manager NRMA, a subsidiary of Insurance Australia Group, which has a 14 percent stake.
"The key will be if there is another bid today or tomorrow. If there's not then it is probably likely the major shareholders will move to accept Ensign's offer," a source said.