BG pulls out of Origin approach

Origin was keen for help to develop its coal seam gas assets

UK gas producer BG Group has ended its hostile takeover bid for rival Australian energy firm Origin.

It said it would not increase its 13.8bn Australian dollar (£6.3bn; $11.2bn) bid after Origin formed a joint venture with ConocoPhillips.

The US oil giant is to put up to $8bn into a joint venture to develop Origin's coal-seam gas assets and build a liquefied natural gas project.

BG said it could not "justify" increasing the price, after the tie-up.

"The price implied by this newly announced joint venture is higher than BG Group is able to justify," said chief executive Frank Chapman.

BG had said in June it would go directly to Origin's shareholders with its all-cash offer after the board rejected a friendly bid of A$15.50 a share in May.

The BG offer was at a 48% premium to Origin's closing share price on 29 April, before the move was announced.