Origin dismisses BG £6.7bn offer

Australian energy group has told shareholders to reject a £6.7 billion bid from the UK's BG Group.

The board of Origin Energy now intends to recommend that shareholders reject BG's bid of AU$15.50 cash per share.

Origin's Chairman Kevin McCann said the offer did not take into account a continued strong interest in the coal seam gas (CSG) and the sudden hikes in oil prices.

However, BG has claimed Origin is over-egging their CSG position.

BG Group chief executive Frank Chapman said: "It remains the case that Origin must spend a significant amount of time and money to prove up its CSG potential. Origin continues to lag its competitors in the exploration and appraisal of its CSG acreage."

He added: "Our offer is not focused solely on Origin's coal seam gas resources. We wish to retain and invest in all of Origin's businesses in Australia - from gas resources and power generation through to retail gas and electricity marketing."

In early trading the BG Group share price fell 0.16 per cent to 1216p.