Letter to Shareholders - Extension of Takeover Offer
As you may be aware, the offer by Landbridge Energy Australia Pty Ltd (Landbridge) to acquire all of the shares in WestSide Corporation Limited (WestSide) has been extended by two weeks and will now close on 8 July 2014 (unless further extended or withdrawn).
Following this extension, I thought I should take the opportunity to reiterate and summarise your Directors' position in relation to the Landbridge offer and WestSide's recent announcements regarding progress with plans to expand the Meridian gas field to supply into the new 20-year Gas Sale Agreement (GSA) with GLNG as outlined in the WestSide Target's Statement sent to you previously.
WestSide has announced continued good progress on development of the Meridian gas field with drilling having commenced in late May and the first of up to six new production wells expected to be on-line in July. All of these wells are scheduled to be commissioned before the end of September.
WestSide is continuing to explore potential debt and project financing options to accelerate future drilling and therefore delivery into the GLNG GSA. If, however, we decide not to raise external finance, as noted in the Target's Statement, existing cash and expected future cash flow can be utilised to steadily ramp up to the full contract volume over a longer period of time.
Gas sales from the Meridian gas field averaged 11.6 TJ/day in May. This was the ninth consecutive month of stable gas production, with no new wells having been drilled for 18 months. This continuing performance reflects the strong underlying potential of the existing well stock which, as noted in the Target's Statement, underpins WestSide's confidence in the productivity of future wells.
As detailed in the Target's Statement, your Board has confidence in WestSide's business and in the value of the GLNG GSA and continues to recommend that you do not accept Landbridge's inadequate, unsolicited and opportunistic takeover offer at the current offer price.
At the date of this letter Landbridge has not advised that any acceptances have been received since their Offer opened on 8 May 2014. The extension of the offer period means that there is no urgent need for you to make a decision. If you accept now, you may also lose the chance to accept a competing offer.
Your Directors continue to recommend that you should DO NOTHING in relation to any documents sent by Landbridge.
You can take comfort from the knowledge that this protracted process, initiated by Landbridge, has not distracted management from forging ahead with its plans to extract full value from the Meridian gas field - value which Landbridge is seeking to secure for its own shareholders at your expense.
WestSide Corporation Limited