SHAREHOLDERS in Aurora Oil & Gas have approved a takeover offer from Canada’s Baytex Energy Corporation, which valued the company at C$2.8 billion.

The offer, which saw Baytex pay A$4.20 for each Aurora share, was approved by 88 per cent of shareholders in the company.

The Canadian company had increased its offer earlier in May from A$4.10 per share in order to attract more support for the offer.

The earlier offer had already secured the endorsement of the Aurora board and an independent expert appointed to consider the deal.

Aurora shares were suspended at A$4.18 following the takeover, which saw Baytex acquire C$900 million in debts, after approval for the scheme was granted by Australia’s Federal Court in Perth.

The deal will see Baytex acquire premier acreage in the core of the Eagle Ford basin, including 22,200 acres in the Sugarkane field located in South Texas.

The Sugarkane field has been largely delineated with infrastructure in place which is expected to facilitate future annual production growth.

In addition, these assets have significant future reserves upside potential from well downspacing, improving completion techniques and new development targets in additional zones.

“The acquisition enhances our growth and income business model, delivers production and reserves per share growth and provides attractive capital efficiencies for future investment,” Baytex said in an announcement.

Baytex issued 38.4 million subscription receipts at C$38.90 each to raise about C$1.5 billion to finance the acquisition.

Aurora chief operating officer Michael Verm will join the Baytex board as vice president and managing director of its Eagle Ford operations after the acquisition is completed.

Baytex chief executive officer James Bowzer said he looked forward to closing the arrangement, which he said was likely to take place in June.

The news came as Raymond Chan was appointed as non-executive chairman of the Baytex board, with Richard Ramsay appointed to replace Marty Proctor as chief operating officer.

Mr Proctor has resigned from the company to pursue other opportunities, Baytex said.