Let The Games Begin

LBO’s Were Too Early

Is it still too early to buy ? Yes No Nobody has a crystal ball; so do what you got to do Current Results

During these troubled times some companies are trading at or below cash or replacement costs. This is allowing for cash rich companies to go shopping

Feb. 17 (Bloomberg) — BG Group Plc raised its hostile offer for Pure Energy Resources Ltd. to A$995 million ($646 million), topping a bid by Arrow Energy Ltd., as it seeks to add coal-seam gas reserves for an Australian export venture.

BG, the U.K.’s third-biggest gas producer, boosted its cash offer by 25 percent to A$8 a share, the company said today in a statement. That’s 11 percent higher than the cash and stock bid from Arrow, based on yesterday’s closing prices, and 7 percent more than Brisbane-based Pure’s close yesterday of A$7.48.

Arrow and BG are among companies building up gas reserves in northeastern Australia to feed planned liquefied natural gas projects that would tap a forecast shortfall in supply. Australia’s coal-seam gas industry attracted more than A$17 billion in investment last year as producers such as ConocoPhillips and Malaysia’s Petroliam Nasional Bhd. bought into ventures that may meet Asian demand for cleaner fuel.

BG’s latest bid “still looks as though it’s within the range of previous acquisitions, so it’s not overspending,” said Andrew Williams, an energy analyst at Credit Suisse Group in Melbourne. “It’s conjecture whether Arrow can come back or not with a higher offer.”

Pure Energy gained as much as 90 cents, or 12 percent, to A$8.38 on the Australian stock exchange, rising beyond BG’s increased offer. Arrow advanced as much as 6.3 percent to A$2.85.

Reading, England-based BG is being advised by Gresham Advisory Partners, while Goldman Sachs JBWere Pty is advising Pure and Wilson HTM Corporate Finance is advising Arrow.

‘Competitively Priced’

Nick Davies, managing director of Brisbane-based Arrow, said earlier today he believed Pure’s assets were “still competitively priced” at Arrow’s latest bid, worth A$7.21 a share at yesterday’s close.