Whitebark Energy Updates Capital Raising and Share Valuation Amid King Energy Takeover Bid

Context of the Takeover and Capital Raising

Whitebark Energy Limited (ASX: WBE) has released a supplementary bidder's statement to update investors on its ongoing off-market takeover offer for King Energy Limited. The update primarily addresses the progress and structure of a capital raising initiative intended to fund exploration activities and support the acquisition.

Initially announced in early February 2025, Whitebark planned a capital raise of up to $3 million through a two-tranche placement. The supplementary statement confirms commitments received for $2 million of this placement via the issue of over 307 million shares at $0.0065 each, with an additional tranche of approximately $1 million subject to shareholder approval.

Details of the Placement and Shareholder Approvals

The placement includes a conversion of outstanding debts totaling $84,040 into shares, alongside a notable participation by Whitebark’s Chairman, Mark Lindh, who has committed to subscribing for $100,000 worth of shares. Lindh will also receive free attaching options, aligning his interests with the company’s growth prospects.

To facilitate the placement, Whitebark has engaged Peak Asset Management and Adelaide Equity Partners as joint lead managers. In return, these advisers will receive options and cash fees contingent on shareholder approval. Notably, Adelaide Equity Partners is associated with Chairman Lindh, adding an element of insider involvement in the transaction.

A general meeting is scheduled for March 2025 where shareholders will vote on the issuance of the second tranche of placement shares, placement options, lead manager options, and facilitation shares. These approvals are critical for completing the capital raising and advancing the takeover offer.

Implications for Capital Structure and Valuation

The supplementary statement provides a detailed pro forma capital structure of the combined group post-acquisition and placement. Assuming full completion, the total undiluted shares on issue would approach 673 million, with diluted shares exceeding 1.1 billion when options and convertible notes are factored in.

King Energy shareholders would hold approximately 14.86% of the combined entity on an undiluted basis, rising to nearly 18% on a fully diluted basis. This shareholding proportion reflects the scale of the acquisition and the dilution impact on existing Whitebark shareholders.

Additionally, the statement corrects the implied valuation of King Energy shares based on Whitebark’s recent trading prices. The updated figures suggest a King share value of approximately $0.0135 per share, subject to market fluctuations in Whitebark’s share price. This correction provides clarity for King shareholders assessing the offer’s attractiveness.

Director Interests and Governance Considerations

Whitebark’s directors, including Chairman Lindh, hold a combined undiluted interest of just over 2%, rising to over 8% on a diluted basis post-transaction. Lindh’s dual role as a director of both Whitebark and its adviser Adelaide Equity Partners underscores the importance of transparency and shareholder scrutiny in the upcoming general meeting.

The supplementary statement emphasizes that all disclosures comply with the Corporations Act and ASX Listing Rules, with the company urging shareholders to seek professional advice if uncertain about the implications.

Looking Ahead

With the general meeting on the horizon, Whitebark’s ability to secure shareholder approval for the placement and associated issuances will be pivotal. The capital raising is intended to underpin exploration activities and support the strategic acquisition of King Energy, which could reshape Whitebark’s asset base and market positioning.

Investors will be watching closely for the meeting outcomes and any subsequent market reaction, as these will signal the confidence of shareholders in Whitebark’s growth strategy and the value proposition of the King Energy takeover.