KEY POINTS:
Origin Energy Ltd, Australia's second largest power retailer, has entered a trading halt pending a decision regarding a A$12.9 billion ($15.8 billion) takeover approach from BG Group.
Origin is the 51.4 per cent owner of Contact Energy, the second largest listed company on the NZSX.
Contact has told the NZX that it has received no other information from BG Group or Origin Energy in relation to the BG Group proposal.
"Contact will inform shareholders of any further developments as appropriate."
Origin said discussions with BG Group had reached a position where the company believed an announcement to the market was warranted, which "is likely to be material" to Origin's share price.
BG Group - formerly British Gas - the UK's third largest natural gas producer, approached Origin earlier this month with a proposal to acquire the company for A$14.70 cash per share.
Origin said an announcement would be made to the market prior to Friday, May 30.
BG Group has received signed funding commitments from a syndicate of banks, believed to include BNP Paribas, HSBC, Royal Bank of Scotland and Santander.
Origin, however, has argued that BG Group must address the true value of its resource position, especially with regard to its extensive coal seam methane reserves in Queensland, and hinted that a higher bid might be required.
Origin provides gas and electricity to more than three million homes and businesses across Australia, New Zealand and the Pacific.
Credit Suisse said in a note to clients that BG Group was unlikely to find resistance to its bid from either the Foreign Investment Review Board (FIRB) or the Australian Competition and Consumer commission (ACCC).
Origin shares last traded at A$14.60.
- NZPA
