ASX:AZZ Antares Energy

Antares Energy says it is open to talks with the US company seeking boardroom control of the Perth-based shale and oil gas play and promoting a five-point plan to double its share price. Antares has advised shareholders it is considering its response to Lone Star Value's approach "having regard to the best interests of shareholders". "This has included engaging with Lone Star with a view to obtaining clarity as to its intentions," it said. Lone Star, an activist investor set up by one of billionaire investor George Soros' former fund managers, has used a newly acquired 5 per cent stake in Antares to requestion a shareholder meeting with the aim of dumping two of its four directors and appointing five nominees. Antares shares last traded at 48¢, capitalising the group at $122 million. Lone Star, however, says the company is potentially worth between 81¢ and $1.49 a share. It claims the group, which was criticised last year by proxy advisers, has been held back by a lack of board independence, poor investor communications and "excessive and poorly structured" executive pay. Lone Star's plan for Antares includes the replacement of executive chairman James Cruickshank with an independent director, a US listing and a revised drilling strategy. It said Antares was "at the crossroads", needing "decisive action and expertise" to increase value through "prudent expansion" of production "rather than go-for-broke as yet unfunded broad strokes".

BRETT COLE THE AUSTRALIAN MAY 31, 2014 12:00AM ANTARES Energy, the Texas-focused oil and gas explorer, says the US activist fund Lone Star Value Investors is trying to take control of the company by replacing two members of the Antares board with five people nominated by Lone Star. “This would deliver control of the Antares board of directors and therefore effective control to Lone Star, a holder of 5.01 per cent” of the company, Antares chairman and chief executive James Cruickshank said. “Your directors believe that for there to be a change of effective control of the company, all shareholders of the company should be appropriately compensated by receiving a fair offer for the full value of their shares, including a premium for control.” A meeting of shareholders would be held to vote on Lone Star’s proposal, said Cruickshank. “Antares had not received any correspondence or communication from Lone Star in relation to their intentions,” Cruickshank said. US activist funds are now common in their home market and will become increasingly active outside the US, says Credit Suisse managing director Chris Young, who covers activist funds out of his New York office.

(Wall Street Journal) Lone Star Value Delivers Open Letter To Antares Chairman And CEO NEW YORK, June 18, 2014 /PRNewswire/ -- Lone Star Value Investors, LP (together with its affiliates, "Lone Star Value" or "we"), a significant shareholder of Antares Energy Limited (ASX: AZZ) (OTC: AZZEF) ("Antares" or the "Company"), today delivered an open letter to Antares Chairman and CEO, James Cruickshank. The full text of the letter follows. June 18, 2014 Mr. James Cruickshank CEO/Chairman of the Board of Directors Antares Energy Ltd. ("AZZ") 3837 Greenbrier Drive Dallas, Texas 75225 USA To James Cruickshank, CEO/Chairman: Despite your apparent opposition to our offer to help Antares Energy Ltd ("Antares") with our expertise, I thought it useful to highlight several points that we believe constructively build upon our recommendations for Antares' prudent funding and development of its assets. As we've stated before, we believe you have a ready playbook to follow in the example of Callon Petroleum (NYSE: CPE) ("Callon"), a management and Board we successfully engaged with tremendous results -- and more importantly a Permian E&P operator with acreage not that far from Antares' own Southern Star footprint. I noticed your recent rebuttal to our claims that Antares has underperformed its peer group in your remarks within Antares' Notice of Meeting -- stating that since July 1, 2008 until June 5, 2014 Antares share price has appreciated 635%, from $0.068 to $0.50. I would ask that if: 1) you recognize our involvement in promoting the intrinsic value of Antares assets which has brought the share price from around $0.40 at the beginning of May to its present $0.50 and 2) if you feel that you're entitled to do whatever you want with Antares' assets and shareholder funds as long as the share price remains above $0.068? We also appreciate that Antares' recent quarterly report highlights the successes of Athlon Energy, which holds acreage close to Antares. Perhaps it would help to realize that five of Athlon's six board members are independent and that this has added value to its development capability. You also asked for some constructive assessments from Lone Star Value and despite our Five Point Plan being quite clear, we'll summarize a few highlights as to how we believe Antares can improve its value for all its current shareholders regardless of their cost basis. First, we would like to introduce you to Callon (one of your successful neighbours in the Permian Basin), and in particular their most recent press release from 12 June announcing an expansion of their financing ability: _____________________________________________________________________________ Callon Petroleum Company Announces 63% Increase in Borrowing Base to $155 Million(1) June 12, 2014 - Callon Petroleum Company (NYSE: CPE) ("Callon" or the "Company") today announced an increase in the borrowing base amount previously established in March 2014 under its Senior Secured Revolving Credit Facility ("Credit Facility"). A borrowing base redetermination was recently completed for the Credit Facility based upon a May 1, 2014 reserve report, and the Company's borrowing base was subsequently increased from $95 million to $155 million, effective June 11, 2014. Fred Callon, Chairman and CEO commented, "The latest increase in our borrowing capacity demonstrates the continued success of our horizontal development program and its impact on our proved reserve base. We appreciate the support of our recently expanded bank lending group and the resulting flexibility it provides for the execution of our future growth plans in the Permian Basin." Callon is an independent energy company focused on the acquisition, development, exploration and operation of oil and gas properties in the Permian Basin in West Texas. _____________________________________________________________________________ As of the first quarter of 2014 Callon paid a weighted average interest rate of 2.41% on its credit facility (LIBOR +1.75% to 2.75%, depending on utilization). We would point out that in the 2(nd) quarter of 2013 Callon had a market capitalisation of nearly Antares' current size which has since more than tripled while pursuing a more prudent funding and expansion program. We would compare this incremental cost of funding with the dilutive and expensive 10% coupon convertibles we've noticed Antares issuing sporadically and without prior strategic reasoning. We would also like to highlight to you that your Permian E&P neighbour, Callon, has increased its net production 20% year-over-year in the first quarter of 2014 already.(2) This of course compares to your stewardship of Southern Star which is marked by a decrease in production from 786 BOE/day upon purchase in April, 2011 to a current 785 BOE/day as at last account in Antares' quarterly report to shareholders.(3) We'd n

Lone Star Value Issues Personal Letter To Antares Shareholders Notes Recent Moves by Antares Show the Urgent Need for Board Enhancement Believes CEO James Cruickshank Runs the Company for His Own Benefit Commits that New Board, if Elected, Will Buy Back Stock to Offset Dilution of Recent Convertible Debt Issuance PR Newswire NEW YORK, June 27, 2014 NEW YORK, June 27, 2014 /PRNewswire/ -- Lone Star Value Investors, LP ("Lone Star Value", "we", or "us") is a significant shareholder of Antares Energy Limited (ASX: AZZ) (AZZEF) ("Antares" or the "Company") and is seeking to enhance the Board of Antares (the "Board") through the election of five new independent directors and the removal of two employee directors at a General Meeting of Antares. Today, Lone Star Value issued a personal letter from its founder, Jeffrey E. Eberwein, to the shareholders of Antares. Dear Fellow Shareholders: I wanted to take this opportunity to tell you about myself, our firm, why we decided to invest in Antares, and why we believe it is so urgent to change Antares' Board at this time. Although I founded Lone Star Value last year and Antares is our first investment in Australia, I have invested in Australia throughout my career and plan to do so for a long time to come. I am originally from Dallas, Texas and have worked with, or invested in, energy companies for 23 years. As a senior portfolio manager at Viking Global and Soros Fund Management, I invested significant amounts of capital globally with a particular emphasis on resource companies. Lone Star Value plans to be a long term investor in Australia and in Antares. In short, we're here to stay. We first began buying Antares stock because we saw a huge gap between the value of its assets and the price at which its shares were trading. We believe this gap is mainly due to Mr. Cruickshank running the Company as his personal fiefdom at shareholders' expense. After analysing the Company and speaking with many frustrated shareholders, we committed to a significant investment and hands-on involvement by enhancing Antares' Board. We believe we can begin to close Antares' value gap through our proposed enhancements. Our goal is to maximise Antares' stock price over the long term – we are not here to make a quick buck and leave the Company in a worse position. Mr. Cruickshank recently stated that he "listens to shareholders and his mobile phone number is at the bottom of ASX announcements". We believe being pro-shareholder is about much more than giving out a mobile number. Being pro-shareholder is about managing the Company for the benefit of its shareholders and always placing their interests first - this is what it means to be a fiduciary. If Mr. Cruickshank truly places shareholder value and rights first and foremost, why did he unilaterally cancel the US$300 million asset sale after Antares' shareholders overwhelmingly approved it at January's extraordinary general meeting? Mr. Cruickshank claims he subsequently (and rather abruptly) gathered new positive information on these assets leading him to cancel the sale, right after the vote was conducted. Shouldn't shareholders have been given the full information Mr. Cruickshank claims led him to cancel the sale? Our experts have examined all public disclosure made by Antares during this period and believe there is no new material news. Shouldn't shareholders have been allowed to vote on whether or not the sale should go through in light of any material changes rather than Mr. Cruickshank deciding this for us? Also, and most importantly, it appears Mr. Cruickshank's ultimate plan was to keep the cash at Antares so he could reinvest it - he NEVER had a plan to sell the Company outright or to sell the assets and return any cash to shareholders. We believe this is why Antares' stock price only rose to a high of $0.58 per share after the asset sale announcement in June 2013 versus the $1+ value per share implied by the theoretical US$300 million proceeds. In our view, a truly shareholder-oriented CEO would have completed the sale for US$300 million, paid off the Company's debts, and then returned the balance in cash ($1+ per share in this case) to the shareholders. We believe that we, as shareholders, are capable of deciding what is in our own best interest when material transactions are involved. We find it VERY telling that Mr. Cruickshank never offered to let shareholders decide if they wanted the cash returned to them at the January shareholder meeting. We have come to the conclusion that the right way to think about Antares -- as it is currently structured -- is that it isn't really a proper oil and gas company – rather, it is Mr. Cruickshank's fully-controlled, personal private equity fund. He buys and sells assets, but shareholders never see any cash. Mr. Cruickshank claims Lone Star Value is seeking control without paying a

Up close to 10% today http://www.theage.com.au/business/markets/quotes/announcement/AZZ/antares-energy-limited/1531699