Downer, which is a significant player in the drilling business through its ownership of Century Resources, revealed last Friday it had paid $1.80 a share to buy Oil Search chairman's Trevor Kennedy seven per cent stake in AOG.
Ensign, which has a 14.9% stake in AOG, saw its bid rejected by the board of AOG after an independent report suggested a mid-point valuation of $2.53 a share.
Industry observers believe Downer wants to expand its presence as the rationalisation of the global oil and gas drilling industry continues. However, observers believe that PICO Inc, which has a 23% stake in AOG, will most likely determine who eventually controls the contract oil driller.
It is not known if the Australian Competition and Consumer Commission will examine the Downer offer, which if successful will deliver it control of over 75% of the country's oil and gas exploration rigs.
