LNG9 PTE Ltd., Singapore, has withdrawn its takeover bid for LNG Ltd., Sydney.
LNG9 said it considers that events, including the failure of First Wall Street Capital Corp. to provide funding under the legally-binding Secured Convertible Note Subscription Deed, are likely to have a material adverse effect on LNGL and that certain conditions under its proposed takeover bid have been triggered or are incapable of being satisfied.
LNG9 informed LNGL that it does not intend to dispatch its bidder’s statement to LNGL shareholders.
The bid implementation agreement under which LNG9 was to bid to acquire all the ordinary issued shares of LNGL was made in February and unanimously endorsed by LNGL directors.
The proposal was that LNGL shareholders receive US$0.13 in cash per share, an offer valuing LNGL at $75 million.
The offer was subject to LNG9 receiving acceptances from at least 90% of shares.
LNG9 planned to make LNGL a private company and deliver LNG to regasification facilities which it would own and operate for supply of LNG into Asian and European markets.
LNGL said LNG9 remains interested in acquiring all or a major part of LNGL and its assets and the two companies will continue to work towards a mutually acceptable transaction structure.
However, the period of exclusivity has lapsed and LNGL is now also working with other parties on strategic alternatives that supplement cash on hand to improve LNGL’s working capital position and sustain its operations.
LNGL said that its existing cash reserves are sufficient to meet its commitments until May, but it must secure additional funding to continue operating beyond that date.
LNGL is developing LNG export terminals in the USA and Canada, particularly the proposed 8 million-tonnes/year Magnolia plant in Louisiana and the proposed 8-12-million tonnes/year Bear Head plant in Nova Scotia.
