The Warrego Energy Ltd (ASX: WGO) share price has started the week with a bang.
In morning trade, the energy explorer's shares are up just short of 12% to 31.5 cents.
This means the Warrego Energy share price is now up 100% since this time last month.
Why is the Warrego Energy share price zooming higher again?
Investors have been scrambling to buy shares again after a bidding war broke out between Beach Energy Ltd (ASX: BPT) and Gina Rinehart's Hancock Energy.
According to the release, Hancock Energy has increased its takeover bid from $0.23 per Warrego share to $0.28 per Warrego share. All other terms of its offer remain unchanged.
The release also reveals that the Warrego board has assessed the revised Hancock takeover offer and has determined that it is a superior proposal compared to the revised scheme proposal from Beach Energy.
Beach Energy's revised offer was for an upfront cash consideration of $0.25 per share, plus the potential for additional scheme consideration if Warrego's Spanish assets are sold within 12 months of implementation of the scheme.
What's next?
Warrego Energy has now issued a notice to Beach Energy under the matching rights regime in the Beach Scheme Implementation Deed. This gives Beach five business days to match the revised Hancock Energy takeover offer.
Until Beach Energy has had an opportunity to match the revised Hancock offer, the Warrego Energy directors maintain their existing recommendation in favour of the Beach scheme proposal.
However, that will very likely change if Beach Energy doesn't improve its offer, given how the company now regards the Hancock Energy as "superior".
And let's not forget that Strike Energy Ltd (ASX: STX) is a dark horse in this race. It tabled a merger proposal last month for 0.775 new Strike shares for each Warrego share held. Based on the current Strike Energy share price, this represents an offer price of 25.575 per share.
Why is Warrego Energy in demand?
All three companies appear to have their eyes on the company's onshore assets in Western Australia's prolific Perth Basin.
The company holds a 50% interest in EP469, including the West Erregulla gas project, and 100% of STP-EPA-0127, covering a massive 8,700 km2 (or 2.2 million acres).
