Tuesday, integrated energy company Origin Energy (OGFGF.PK) issued its Target's Statement advising shareholders to reject BG Group(BG.L)'s conditional takeover offer because it undervalues Origin's existing business and outstanding prospects.
Late June, UK's oil and natural gas producer BG Group offered A$15.50 in cash for each Origin Energy share, valuing the company at A$13.8 billion. The hostile bid was launched directly to shareholders about a month after Australia-based Origin rejected its unsolicited proposal at the same price.
Origin's Chairman Kevin McCann said that the company has developed a leading position in Coal Seam Gas (CSG), which will be a key driver for continuing growth. In June, Origin initiated a process to accelerate the development CSG reserves of the company and it has received CSG to LNG project proposals from a number of global participants in the energy industry.
"Prior to the closing date of BG's offer, Origin intends to provide shareholders with an Independent Expert's Report. The Report will include a valuation of Origin's shares based on all relevant information about Origin's value and prospects, including the outcome of the CSG monetisation process." McCann noted.
The company said that the average broker 12-month share price targets, ranging from A$17.01 to A$20.00 are materially above BG's offer. Origin's average share price has been above the A$15.50 since the company's rejection of this price on May 30.
Commenting on the Target's Statement, Grant King, chief executive officer of Origin said that the company has the largest CSG reserves and is the leading developer of CSG with an outstanding fuel integrated generation and retail business.
The company has an impressive track of business and underlying earnings growth and is well placed to benefit from rising energy prices and increasing demand for gas. A CSG to LNG project may deliver additional value, Grant King noted.
BG was seeking to create value for its own shareholders at the expense of Origin's shareholders. In addition, Shareholders who accept BG's offer may incur a significant tax liability, the company noted.
McCann said, "Directors believe it is in shareholders' best interests to reject BG's offer."
OGFGF.PK traded last on August 5 at $14.50.
For comments and feedback contact: editorial@rttnews.com
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.