Arrow Acquisition by PetroChina and Shell

Submitted by Share Trading on 15 July, 2010 - 11:11

Shareholders of Australian company, Arrow Energy (AOE), a supplier of coal seam gas to eastern Australia and Asia, have approved a $3.5 billion acquisition by Royal Dutch Shell and PetroChina, permitting China to extract Australia's coal seam gas. The proposal was put forward by CS CSG (Australia) Pty Ltd, a 50/50 joint venture company owned by Shell Energy and PetroChina. In March, Shell and PetroChina agreed to buy Arrow's Australian business for $4.70 a share in cash. Arrow investors will also receive shares in a new company, Dart Energy, which will hold the explorer's overseas gas assets and Arrow's stakes in Australian-listed companies. Arrow shares closed at $4.99 on the Australian stock market on Wednesday.

Dart is set to begin trading on July 22, with the Shell and PetroChina takeover due to be implemented on August 23. But the deal still needs approval from Australian federal court by the end of this month. PetroChina is the world's No. 2 oil and gas producer, and controls more than 60 percent of China's gas output. Arrow announced that it had received the green light from the National Development and Reform Commission of China. Arrow shares will cease trading on the Australian Securities Exchange on July 30, subject to approval from the Federal Court of Australia, which is expected to hear the matter on July 29 before it is approved.