Baron Oil Plc announced on 14 November 2019 that the company has entered into a non-binding Heads of Agreement (HOA) to acquire the entire share capital of SundaGas Pte Ltd. The proposed transaction is classified as a reverse takeover, pursuant to AIM (Alternative Investment Market of London Stock Exchange) rules. Completion of the transaction is subject to approval from Baron's shareholders, satisfactory completion of due diligence, granting of Rule 9 waiver (Rule 9 of the takeover code), publication of AIM Admission Document (detailing, inter alia, the terms of proposed transaction) as well as execution of a legally binding Sale and Purchase Agreement (SPA).  The acquisition will be partially settled through fund raising via share issuance by Baron Oil to SundaGas for a pro-rata of two new ordinary shares in Baron for each ordinary share currently in issue. The ordinary shares to be held before the fund raising for SundaGas and Baron Oil will be respectively 3,852,819,512 (66.67%) and 1,926,409,576 (33.33%). Apart from the fundraising, Baron intends to carry out share consolidation and change its name to SundaGas Plc as part of proposal.  SundaGas will provide an unsecured loan facility of up to GBP 200,000 (USD 257,695) to Baron Oil for cost related to the proposed transaction, with a nominal interest rate of 1% per annum, to be paid within 90 days if the proposed transaction is void.  Assets covered under the transaction deal include Telen PSC, located in the deepwater Kutei Basin, and the Chuditch block in offshore Timor Leste. A performance bond of USD 4.45 million was previously paid for the Telen PSC, and will remain in place upon completion of the proposed transaction. The Chuditch block was awarded to SundaGas (via subsidiary SundaGas Banda Unipessoal, 75% PI with operatorship) and Timor Gap Chuditch Unipessoal (25% PI) on 8 November 2019. The block was awarded through the TL-SO-19-16 Production Sharing Contract through direct negotiation.  SundaGas holds 100% operating interest in the Telen block. The company acquired the asset from Total in 2018. The initial six-year exploration period for the PSC expired in October 2018 and the block has subsequently entered the final four-year exploration period until October 2022. Exploration commitments, including one exploration well and 200 km 2D seismic acquisition, are due by October 2020. SundaGas offered a farm-in opportunity for the block in April 2019. The block contains the Hiu Marah prospect, a large structural closure with estimated prospective resources (2U) of 161 MMboe, including 126 MMbo and 208 Bcfg, within Middle Miocene turbidite sandstones of the Sepinggan Formation. The prospect is considered a low-risk target (Geological Chance of Success is estimated at 23%) based on the presence of DHIs identified from available 3D seismic data (including flat spots and AVO anomalies), as well as analogy with nearby discoveries.  SundaGas and Baron Oil entered a joint venture agreement in 2016 to explore new business opportunities in SE Asia. Discussions between the companies were still underway as of September 2019.
Baron Oil has entered into a non-binding HoA with SundaGas with a view to acquire the latter's share issued capital under a reverse takeover. SundaGas is involved in Indonesia (Telen block) + Timor-Leste (new Chuditch block,