Z Energy owns 15.4% stake in New Zealand’s only oil refinery. Credit: Denny Franzkowiak / Pixabay.

Australia’s fuel supplier Ampol has made takeover offer of $1.34bn (NZ$1.97bn) for New Zealand fuel distributor Z Energy.

The non-binding indicative acquisition proposal, which values each share of Z Energy at $2.57 (NZD3.78), would be implemented by way of a New Zealand scheme of the arrangement, the firms said.

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Ampol said it would also consider making some of the payments in Ampol shares to Z Energy.

Ampol CEO and managing director Matt Halliday said: “Z Energy is a logical growth opportunity for Ampol as both companies are market leaders in their respective home markets and have very similar business models.

“A successful acquisition would create an A&NZ leader in fuel, with significant regional scale and trusted and iconic brands on both sides of the Tasman.

“Ampol believes that it will bring considerable benefits to the New Zealand market, helping to maintain fuel security and support New Zealand industry.”

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Furthermore, the two companies are considering a partial share consolidation for Ampol and a potential Ampol secondary listing on New Zealand’s Exchange (NZX).

The two firms have also agreed on a four-week period of exclusivity allowing Ampol to undertake due diligence.

In order to secure approval from Commerce Commission, Ampol has expressed readiness to divest its Gull fuel station business in New Zealand.

Z Energy noted that the latest offer marks the fourth from Ampol in recent months. The Australian firm earlier made offers of $2.28 (NZD3.35), $2.38 (NZD3.50) and $2.45 (NZD3.60) per share.

Z Energy owns a 15.4% stake in New Zealand’s only oil refinery Refining NZ, which is planned to be converted into a fuel import terminal.

It also owns and operates about 208 service stations, around 160 truck stops, and pipelines, terminals and bulk storage terminal infrastructure in New Zealand.