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LONDON (Alliance News) - Mosman Oil and Gas Ltd Tuesday said it has sent letters to shareholders in MEO Australia Ltd recommending they accept the company's takeover offer.
Mosman is offering one Mosman share for each 10 MEO Australia shares and urged shareholders to "exchange your MEO shares for shares in a growing company operated by an experienced management team."
In the letter, Mosman said it is "committed to low corporate and administrative expenditure", has a "clearly defined plan for creating shareholder wealth", and highlighted it has "experienced exploration success" since listing on AIM.
In addition, Mosman said if MEO shareholders reject the deal, they "risk suffering additional losses on their investment in MEO by remaining a shareholder in a stand alone company that has, in recent years, experienced a significant reduction of its market capitalisation and significant diminishment of its cash reserves."
"The Australian Securities Exchange trading price of MEO shares having fallen from 37 cents three years ago to just 1.3 cents as at the date of this letter," said Mosman.
"The current directors of MEO have been either at the helm or heavily involved in MEO throughout this prolonged period of under-performance," it added, specifically mentioning Messrs Greg Short, Stephen Hopley and Peter Strickland.
"The board of Mosman is of the opinion that the directors of MEO should not be provided with the opportunity to "wash their hands" of MEO's under-performance and failures and that MEO shareholders should entrust the management of MEO, via a combination with Mosman, to the Mosman directors by accepting the takeover offer," said the company.
Mosman shares closed down 4.8% in London at 9.40 pence per share Tuesday.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
Copyright 2015 Alliance News Limited. All Rights Reserved.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
Copyright 2015 Alliance News Limited. All Rights Reserved.