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AWE discussing friendly bid for Arc

AUSTRALIAN Worldwide Exploration has said that it is in talks to acquire Arc Energy, which would ...

AWE discussing friendly bid for Arc

"The negotiations are preliminary and incomplete, and no agreement has been reached in relation to the proposal," AWE said in a statement today.

While the two companies expect to be able to make a formal announcement by the end of this month, there was no certainty that an agreement would be reached or that a formal offer or proposal will be put to Arc's shareholders, according to AWE

The statement confirms a report in Sydney Morning Herald that AWE was considering a friendly $500 million bid for Arc that could create a mid-tier company worth about $2 billion.

The proposed acquisition of Arc will increase AWE's stake in the Origin Energy-operated BassGas development by 12.5% to 42.5% while its stake in the Roc Oil-operated Cliff Head field in Western Australia will more than double to 57.5%.

Arc and AWE first discussed a merger a couple of years ago. Arc last year signed a friendly agreement to buy Anzon Energy, but the deal was scuttled after Nexus Energy stepped in with a better offer.

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