Triangle receives ?superior proposal?

By Romel S. Gurky

ASX-listed Triangle Energy (Global) Limited (TEG) announced Monday that it has accepted a ?superior proposal? of up to US$32.4 million (approximately A$45.3 million) in relation to the company?s interest in the Pase PSC, Aceh.

The company said in a statement that the superior proposal was made by a consortium comprising One North Energy Private Limited, Lamara Energy Pte Ltd and Boustead Singapore Limited.

?The company has accepted the superior proposal and such acceptance constitutes a binding agreement between TEG and the consortium, subject to certain conditions and the approval of the company?s shareholders,? TEG said in the statement.

Boustead, listed on Singapore Stock Exchange, is one of the oldest companies in Singapore established in 1828 and is primarily engaged in energy, oil and gas and infrastructure related engineering services as well as geo-spatial solutions globally. Boustead?s current market capitalisation is in excess of A$500 million and its annual revenues are in excess of A$550 million. Boustead was previously recognized in the prestigious ?Forbes Asia 200 Best Under A Billion? as one of the Asia Pacific?s 200 best publicly-listed corporations under US$1 billion in revenue. Boustead is part of the MSCI World Small cap Index for Singapore and the FTSE ST Small Cap Index.

One North Energy and Lamara Energy are Singapore based companies founded and backed by individuals with over 100 years of combined experience in the oil & gas sector, of which substantial time has been spent managing and operating exploration & production assets in Asia Pacific, including Indonesia.

TEG explained that its directors, after taking all required advice, have concluded that the proposal is a ?superior proposal? under the terms of the agreement between PT Enso Asia (PTEA) and Triangle, as announced to the ASX on July 31, 2015.

PTEA agreement has total value of up to US$10.5 million (approximately A$14.7 million). By comparison, the superior proposal represents a total value of up to US$32.4 million (approximately A$45.3 million)

Key highlights of the superior proposal are as follows:
? The consortium will acquire 100 percent of the shares in Triangle Energy Limited (TEL), a wholly owned subsidiary of the company, which in turn wholly owns Triangle Pase Inc (TPI), the company which holds Triangle?s interest in the Pase PSC.
? The key financial terms are as follows:
- a consideration of US$3.9 million, part of which is payable upon accepting the proposal and the balance payable at completion (which will occur upon shareholder approval of the sale);
- production royalty on new developments on the PSC equal to 5% of the Consortium?s profit share (excluding cost recovery) up to a maximum of US$2 million per annum and capped at US$20 million in aggregate;
- up to US$5 million out of the actual cost recovery from the existing fields in the Pase PSC area;
- the assumption of certain liabilities of TPI of approximately US$420,000;
- the signature bonus of US$1.5 million payable to the Indonesian government;
- a performance bond of US$1.5 million in favour of the Indonesian government; and
- reimbursement of TEG?s transaction costs of up to US$100,000.

?The superior proposal is subject to the approval of Triangle shareholders. The directors recommend that the shareholders vote in favor of the superior proposal, in the absence of a further superior proposal,? TEG said.

It added that a notice of meeting advising the date of shareholders? meeting to consider the superior proposal and setting out the details of the superior proposal will be sent to the shareholders as soon as possible.

?As announced earlier today, the directors decided to postpone today?s shareholders? meeting in order to provide shareholders additional information necessary to ensure they are informed and are able to properly consider their vote on the transaction with PTEA in the context of the recent developments,? TEG said.

It said that the meeting to consider the PTEA transaction will now be held on December 4, 2015 and the directors now withdraw their previous recommendation for that resolution.

Editing by Reiner Simanjuntak