Nexus Energy Up 28% Early On A$480 Million Shell Takeover Speculation

Shares in Melbourne-based junior oil and gas explorer Nexus Energy Ltd. (NXS.AU) rose strongly in early trade Tuesday after a local newspaper reported that shareholders were being sounded out over a A$480 million takeover bid.

The Australian newspaper, citing industry sources, said that speculation was centering on a bid by Royal Dutch Shell PLC (RDSA), which has rights to gas from Nexus' Crux field off the coast of Western Australia.

At 0043 GMT, Nexus shares were up 7.5 cents, or 25%, at 38 cents, short of the rumored 50 cents per share takeover price cited by the newspaper.

Spokeswomen for Shell and Nexus weren't immediately available for comment. Senior Nexus staff were meeting till around midday, said a receptionist at their Melbourne office.

The company's shareholder register is diverse, with the largest shareholder--Norway's Clauson shipping family--owning just 7.2% of the stock, followed by a 6.3% slice owned by U.K. fund manager M&G.

The Australian reported that "it is understood one of the shareholders that has been sounded out is London-based".

Nexus non-executive director Symon Drake-Brockman, the former head of capital markets at U.K. bank RBS, owns a further 4.9% of the stock.

No other interests are significantly larger than 1%, although companies connected to the family of late Melbourne industrialist Victor Smorgon hold several separate stakes.

-By David Fickling, Dow Jones Newswires; [phone]; [e-mail]