SYDNEY (Bloomberg) -- Roc Oil Co., the Australian company exploring in Mauritania, China and Angola, is seeking to buy Anzon Australia Ltd. for about A$545 million ($512 million) to double reserves and lift output by 40 percent amid record prices.

Roc agreed to buy the target’s 52 percent owner Anzon Energy Ltd. for A$268 million in shares and is offering about A$1.47 a share in scrip and cash for the rest of the Sydney-based unit, Roc said today in a statement. Anzon Australia, whose shares jumped 6.5 in Sydney, advised shareholders to take no action.
Buying London-listed Anzon Energy and its Australian unit will give Roc a share in production from the Basker-Manta oil venture off the southeast coast, adding to its output in Western Australia, the U.K. and Mauritania.
Rival Nexus Energy Ltd. last month scrapped a proposal to buy Anzon Australia for A$648 million, leaving the target seeking another partner. Nexus had earlier outbid an offer from Arc Energy Ltd.
“The company has clearly put itself up for sale, there have been a number of offers which for various reasons haven’t occurred, and now this is yet another,” said Stuart Baker, an oil and gas analyst at Morgan Stanley in Melbourne. Should the offer succeed, it “would be a good outcome for Anzon shareholders,” he said.
Anzon Australia advanced 8.5 cents to A$1.39 in Sydney. Sydney-based Roc Oil slid 11 percent to A$1.79, cutting the value of its offer for Anzon Australia from A$612 million when it was announced. Roc is being advised by Gresham Advisory Partners Ltd., while Anzon Energy is being advised by Macquarie Capital Advisers.
----------------Shares, Cash
Roc agreed to pay 1.33 shares for each share in Anzon Energy, valuing the company at about A$2.38 or 115 pence at Monday’s closing share price. That’s down from about A$2.69, or 130 pence announced earlier by the two companies in the joint statement to the Australian stock exchange.
Anzon Energy, which on June 13 closed at 96.5 pence in London, jumped as much as 15 percent today to 111 pence. Sydney-based Roc is offering 0.792 share plus 5 Australian cents for each Anzon Australia share.
“The enlarged company will occupy a rare space in the Australian and international oil and gas scene, and we are already focused on taking it to the next level,” Roc Chairman Andrew Love said in the statement.
Arc’s share-based offer initially valued Anzon at about A$1.87 a share, or A$708 million, in October. That valuation had slid by the time Nexus offered A$1.75 a share, or $648 million, in cash and stock in January.
Roc’s offer is lower, reflecting that Anzon’s Basker-Manta project “requires further development and understanding,” Morgan Stanley's Baker said. “It doesn't come without risk,” he said.
--------------------Nexus Stake
The only asset of Anzon Energy, which is recommending the offer to shareholders, is the majority stake in the Australian company. Should the Anzon Energy takeover proceed and the Anzon Australia offer fail, Roc will replace Anzon Energy as Anzon Australia's majority shareholder.
“The key thing is we don’t need 100 percent” of Anzon Australia, Roc Chief Executive Officer John Doran said in a telephone interview. He said he’d had “positive, benign” signals from Anzon Australia’s second-biggest shareholder, Nexus Energy, which has indicated it may sell its shares.
Anzon also owns shares in Melbourne-based Nexus and Roc’s offer may provide an opportunity to cancel out the cross- shareholding, Nexus Managing Director Ian Tchacos said by telephone. Nexus would prefer a transaction where the cross- shareholdings are canceled out, rather than sell shares into Roc’s offer, he said.
-----------------‘Opens Opportunities’
“`In general we see it as a positive; it opens up opportunities for us,” Tchacos said.
Roc estimates Anzon has about 27 million barrels of oil and gas resources, less than Anzon’s own estimate of 40-42 million, Doran said. The acquisition values Anzon’s resources at just over A$19 a barrel should it succeed, he said. It would increase Roc’s output by 4,000 barrels a day, adding unhedged, “premium” crude, he said.
The purchase would prevent Roc’s production declining beyond 2010, Doran said.
The independent directors of Anzon Australia, which is being advised by RFC Corporate Finance, will consider the offer and make a recommendation to shareholders, the company said in a separate statement to the exchange.