Cooper Energy Limited has declared its intention to make a takeover bid for Incremental Petroleum Limited.

Under the Offer, Cooper Energy is offering all Incremental shareholders a choice of: • 3.1 Cooper Energy shares (All Share Alternative); or • 50 cents cash and 1.9 Cooper Energy shares (Cash and Share Alternative) for each Incremental share they hold.

The All Share Alternative values Incremental at 132 cents per share, or approximately $104 million, and implies a premium of 35% based on the closing prices of Cooper Energy and Incremental shares on 5 September 2008. Under the terms of the Offer, Incremental shareholders will be entitled to retain the Incremental unfranked interim dividend of 3 cents per share announced on 26 August 2008 and payable on 17 October 2008.

Commenting on the Offer, Cooper Energy Managing Director Michael Scott said: “Cooper Energy believes this is a very attractive offer for Incremental shareholders and provides a compelling value and strategic proposition. Cooper Energy and Incremental have highly complementary hydrocarbon production and exploration interests that if combined would immediately deliver a new mid-tier oil and gas company with strong production revenue and a diversified and larger asset portfolio, which would position the combined company for growth.”

“Cooper Energy strongly believes this is an opportunity to create increased value for all shareholders, employees and other stakeholders. The Offer is attractive for Incremental shareholders as it provides them with a number of benefits, including:

• a premium of 35%; - Assuming the All Share Alternative and based on closing prices on 5 September 2008 • a choice of consideration; • a larger, more diversified oil production and asset portfolio; • enhanced revenues and a stronger financial position; and • enhanced management and technical teams;

“Cooper Energy has approached Incremental’s directors on several occasions but unfortunately we have not been able to convince those directors to consider entering into discussions to combine the two companies in a timely manner. As Cooper Energy believes this is a value accretive transaction, Cooper Energy has decided to put the Offer directly to Incremental’s shareholders to allow them to decide on its merits.”

“To demonstrate Cooper Energy’s belief in and commitment to the combination, Cooper Energy recently bought a 4.99% stake in Incremental on market.”

“Importantly, Cooper Energy’s Offer has already received strong endorsement with a significant institutional shareholder of Incremental agreeing to lodge acceptance instructions for the All Share Alternative when Cooper Energy establishes an institutional acceptance facility for the Offer. Cooper Energy believes this demonstrates the compelling nature of the Offer and the significant benefits it will provide to both Incremental and Cooper Energy shareholders.”

Tags: Cooper Energy, Incremental Petroleum