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Deal remains live after due diligence for AOW

Deal remains live after due diligence for AOW

Published on: | by finfeed

Running Foxes Petroleum has done its due diligence on American Patriot Oil & Gas (ASX:AOW) and is going ahead with its takeover bid.

AOW told the market today that RFP had completed its due diligence and the takeover bid remained live after taking a look under the AOW bonnet.

In February the private US company launched a 22c per share bid for 100% of the share capital of AOW – effectively valuing the company at around $35 million.

This was after AOW had received an earlier offer from private oil investor Mike Davis for $20 million for an asset-level transaction.

It knocked back the Davis bid and is now advising investors to take no action on the bid as it canvasses major shareholders to see whether the offer has traction.

It also remains in discussions with “a number of other interested parties” which may or may not lead to another bid for the company.

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About AOW

AOW holds a number of oil and gas leases in four states of the US, with the Northern Star project in Montana and the Rough House project in Colorado considered the leading assets.

Its overarching strategy is to work up assets to a point where it can farm them out to a bigger partner, while retaining a working interest in the asset and more often than not receiving a free carry on wells in the program.

In the case of Running Fox, it farmed into Rough House in February, taking a 70% operating stake in the asset and committing for up to five wells.