MEO rejects Mosman bid, cuts costs

January 29, 2015

MEO Australia has announced moves to cut corporate overheads by more than 60% compared to the 2014, to about AU$2.5 million per annum from March 2015, in reaction to low oil prices.

The firm has also recommended that a take over offer from Mosman Oil and Gas is rejected by shareholders.

Image: MEO's assets. Image from MEO.

MEO has a portfolio of exploration, appraisal and development stage opportunities on the North West Shelf, the Ashmore Cartier and the Timor Sea regions in Australia and onshore New Zealand.

MEO said the cost cutting was being achieved in part by more flexible employment arrangements to ensure MEO retains access to the core skills and experience necessary to manage its existing business as well as growth opportunities.

CEO Peter Stickland said: “MEO is determined to both survive and thrive, despite the dramatic deterioration in the business environment over the past six months. These cost cutting measures announced today, along with its cash balance of nearly $10 million will mean that MEO is in a stronger position to both surviv CEO Peter Stickland said: “MEO is determined to both survive and thrive, desp

ite the dramatic deterioration in the business environment over the past six months. These cost cutting measures announced today, along with its cash balance of nearly $10 million will mean that MEO is in a stronger position to both survive the current downturn and also take advantage of value creation opportunities."

The bid proposal from Mosman follows MEO's own failed move to merge with fellow independent Neon Energy. After lodging a Scheme Booklet in December, Neon backed out of the deal.

Then, Mosman Oil and Gas put forward a proposal to acquire MEO, which was later revised, but, says MEO, the offer is a heavy discount to MEO's latest trading price, could dilute share value, is conditional on shareholder agreement and Mosman, MEO says, has limited cash reserves.



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