Rinehart takes majority stake amid battle for Perth Basin gas company

Gina Rinehart, the nation’s richest person, has become the controlling shareholder of Western Australian junior gas producer Warrego Energy as a months-long takeover battle for the company continues.

Hancock Energy, the energy division of the mining magnate’s privately owned Hancock Prospecting, on Monday said enough Warrego shareholders had now opted to sell their stock to Hancock at its offer price of 36¢ a share to give it a majority position of more than 50 per cent.

Hancock said its increased voting power meant its offer to buy Warrego will now be extended until February 24. The group called on remaining shareholders to back its proposal instead of a rival, all-scrip offer from Warrego’s joint-venture partner, Strike Energy.

“Hancock considers Strike’s scrip offer likely delivers an inferior outcome to all remaining Warrego Shareholders in all cases,” Hancock said. “This includes any Warrego Shareholder who may be interested in swapping their Warrego Shares for Strike shares.”

Hancock’s elevation to majority owner is the latest turn in a drawn-out tussle for control of ASX-listed Warrego and the prized 50 per cent interest it holds in a promising onshore gas basin 230 kilometres north of Perth.

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Some of WA’s most prominent energy investors including Hancock, Strike and billionaire Kerry Stokes-backed Beach Energy have been bidding for Warrego because of its half-ownership of WA’s West Erregulla gas field that could quickly be brought into production without the need for hydraulic fracturing in a domestic gas market that is tipped to tighten in the coming years.

Strike, which is Warrego’s partner in the West Erregulla field, has argued its one-for-one shares offer is superior to Hancock’s as it will enable Warrego investors to retain their exposure to a “high-quality Perth Basin asset portfolio” at a time when WA’s gas supplies are expected to tighten and drive prices higher.

“Hancock’s competing proposal places a final and terminal value on Warrego,” Strike said previously. “Strike’s offer will allow Warrego shareholders to participate in ongoing upside.”