Woodside CEO Defends Bid for Oil Search as `Fully Priced'

  • Offer for LNG investor is `very competitive,' Coleman says
  • Woodside known for capital discipline, CEO tells reporters

Woodside Petroleum Ltd. Chief Executive Officer Peter Coleman is maintaining that his company’s A$11.65 billion ($8.6 billion) bid for Oil Search Ltd. is “very competitive” in the face of speculation his company will make a higher offer.

“We’re known for capital discipline,” Coleman told reporters in Vancouver, after speaking at a liquefied natural gas conference. “We aren’t talking about particular bids at particular periods of time, but we’ve been very clear to the market that the offer we’ve made is a fully priced offer.”

Oil Search, Exxon Mobil Corp.’s partner in an LNG export project in Papua New Guinea, last month rebuffed the offer by Woodside, the Australian oil and gas producer. A deal would lead to the biggest energy takeover in the Asia Pacific region. Woodside’s bid of one share for every four Oil Search shares, which implied a 14 percent premium, “grossly undervalues” the company, the Papua New Guinea explorer said in a statement last month.

Woodside will probably make a higher offer, with almost A$13 billion needed to win over Oil Search investors, analysts at Sanford C. Bernstein & Co. said last month. Woodside is considering a modest price increase in its approach for Oil Search, the Australian Financial Review reported this week, citing unidentified sources familiar with the matter.

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