TALIUS GROUP LIMITED — Merger & Acquisition 2009

Jun 4, 2009

5 June 2009

BLAZE ASSET Pty Ltd

ACN 134 038 412 tel +61 8 9486 1122 fax +61 8 9486 1011

Suite 2, 16 Ord Street West Perth Western Australia 6872

Company Announcements Office

ASX Limited 20 Bridge Street SYDNEY NSW 2000

Blaze Asset Pty Ltd - Takeover bid for all shares in Target Energy Limited

Increase of Consideration and Extension of Offer Period

Blaze Asset Pty Ltd's (Blaze) had made an off-market takeover bid for all of the fully paid ordinary shares in Target Energy Limited (Target).

Blaze is pleased to announce that as of 4 June 2009 it had received acceptance equating to 5.14% of Target's voting rights and has this morning lodged its ASIC form 603 (Initial Substantial Holder Notice).

Given the obvious interest in the offer to date shown by the level of acceptances, the Board of Blaze have reconsidered the Offer and resolved to increase the consideration offered to Target Shareholders.

Blaze will now offer Target Shareholders 1c (\$0.01) and 1 Advance Share for each Target Share. This increased consideration is payable to all Target Shareholders, even those who have already accepted Blaze's offer prior to this announcement.

Attached is Blaze's Supplementary Bidder's Statement.

In accordance with section 624(2) of the Corporations Act, the Offer Period is extended to 19 June 2009.

Alex Bajada Chairman Blaze Asset Pty Ltd

This statement is a supplementary bidder's statement under section 643(1) of the Corporations Act dated 5 June 2009 (Supplementary Bidder's Statement).

It supplements the bidder's statement issued by Blaze Asset Pty Ltd ACN 134 038 412 (Blaze or Company) dated 16 April 2009 (Bidder's Statement) issued in connection with the Offer by Blaze to acquire all of the shares in Target Energy Limited ACN 119 160 360. This Supplementary Bidder's Statement must be read together with the Bidder's Statement.

A copy of this Supplementary Bidder's Statement was lodged with ASIC and provided to ASX on 5 June 2009. ASIC. ASX and their respective officers take no responsibility for the contents of this Supplementary Bidder's Statement.

This is an important document and requires your immediate attention.

If you are in any doubt about how to deal with this document, you should contact your broker, financial adviser or legal adviser immediately.

Supplementary Bidders Statement

BY

Blaze Asset Pty Ltd ACN 134 038 412

in relation to an off-market bid to acquire all of your fully paid ordinary shares in

Target Energy Ltd ABN 73 119 160 360

Defined Terms $1₁$

Unless otherwise defined in this Supplementary Bidder's Statement, capitalised terms used in this Supplementary Bidder's Statement have the same meaning as was given to them in the Bidder's Statement.

Amendments to the Bidder's Statement $2.$

$2.1$ Consideration

Blaze is increasing the consideration for its Offer from 1 cent (\$0.01) and 0.75 Advance Shares for each Target Share to 1 cent (\$0.01) and 1 Advance Share for each Target Share.

$2.2$ Effect of Offer on Advance

The increase of the consideration from 0.75 Advance Share to 1 Advance Share for every Target Share alters section 8.4 of the Bidder's Statement, 'The Effect of the Offer on Advance.' Section 8.4 of the Bidder's Statement is replaced with the section in the Schedule to this Supplementary Bidder's Statement.

2.3 Effect on Offer Period

Under section 624(2) of the Corporations Act, the Offer Period is extended to 19 June 2009.

Under section 630(2) of the Corporations Act, the new date for the notice of status of conditions under section 630 of the Corporations Act, referred to in section 10.8 of the Bidder's Statement, is now 12 June 2009.

To the best of Blaze's knowledge, none of the Prescribed Occurrences have occurred and the Offer is still subject to the conditions in section 10.8 of the Bidder's Statement.

Approval of Supplementary Bidder's Statement $3₁$

This Supplementary Bidder's Statement has been approved by a unanimous resolution of Blaze's Board

Signed for and on behalf of Blaze Asset Pty Ltd

x Baiadá Director

Schedule - New Section 8.4

$8.4$ Effect of the Offer on Advance

Advance's annual report for the year ended 31 December 2008 includes a statement of accounting policies and various notes to the financial statements. Advance has applied those same accounting policies in the preparation of the financial information below.

• $(a)$ Blaze acquisition of 0% to 50% of Target
• Effect on the financial position if Blaze acquires 0% to 50% of Target $(i)$
  • Pro forma Balance Sheet $(A)$

To illustrate the financial impact of Blaze acquiring 0% to 50% of Target Shares, a pro forma balance sheet of Advance has been prepared based on its audited balance sheet as at 31 December 2008. The pro forma balance sheet assumes that Blaze acquires 30% of Target Shares:

Pro forma Balance Sheet Advance Energy Ltd

	Advance 31/12/2008 audited	Effect on Advance if Blaze acquires 30% of Target
	\$'000	\$'000
Total current assets	4.403	6.450
Total non-current assets	24,706	24,706
TOTAL ASSETS	29,109	31,156
Total current liabilities	9,698	9.698
Total non-current liabilities	9,734	9,734
TOTAL LIABILITIES	19,432	19.432
NET ASSETS	9.677	11,724
Issued share capital	12,692	14,739
Reserves	4,444	4 4 4 4
Asset revaluation
Minority Interest
Accumulated losses	-7,459	-7,459
TOTAL EQUITY	9,677	11,724

• $(B)$ Key Financial Impacts
• Current shareholder loan in Balance Sheet of \$2.047m;
• No increase in liabilities; and $\bullet$
• Increase in share capital of \$2.047m.
• $(ii)$ Effect on capital structure if Blaze acquires 0% to 50% of Target
• $(A)$ Issued capital

Assuming Blaze acquires 30% of the Target Shares on issue as at the date of this Bidder's Statement and issues Advance Shares as consideration under the Offer, the total number of Advance Shares which would be on issue is in the table below.

	30% Acceptances and no Target Options Exercised 1	30% Acceptances and all Target Options Exercised 2
Issued Advance Shares as at the date of this Bidder's Statement	118,798,222	118,798,222
Number of Advance Shares to be issued under the Offer	31,296,351	100,858,515
Issued Advance Shares following the Offer	150,094.573	219.656.737

Notes:

• $\mathbf{1}$ . This represents the number of Advance Shares that would be issued based on the existing number of Advance Shares on issue and no Target Options being exercised during the Offer Period.
• This represents the maximum number of Advance Shares that would be issued $2.$ pursuant to the Offer, assuming all Target Options are exercised during the Offer Period. The exercise prices of the Target Options range from \$0.12 to \$0.25 per option, and if all Target Options were exercised, Target would receive additional cash of approximately \$16.96 million from the payment of the exercise price of the options.

The actual number of Advance Shares on issue will depend upon the number of acceptances of the Offer and the effect of rounding of fractional entitlements (which will be rounded up to the nearest whole number).

$(B)$ Ownership structure

The issue of Advance Shares to pay for Blaze's acquisition of Target Shares will impact upon Advance's substantial shareholders. Based on current shareholdings, the table below summarises the expected substantial shareholders of Advance on completion of the Offer.

	Current Holdings		Post offer Based on 30% acceptances and no Target Options exercised	Post offer Based on 30% acceptances and all Target Options exercised
Shareholder	Number of Advance Shares	Percentage	Percentage	Percentage
Bardev Ptv Ltd	10,156,165	8.55%	6.77%	4.62%
A N Short/Fay Holdings Pty Ltd	16,458,599	13.85%	10.97%	7.49%
R P Martin	9,318,211	7.84%	6.21%	4.24%
G A Sklenka/Formaine Pty Ltd	6,805,357	5.73%	4.53%	3.10%
A J Carew-Reid	7,527,172	6.34%	5.01%	3.43%
	50,265,504	42.31%	33.49%	22.88%

• $(b)$ Effect upon Advance of acquiring greater than 50% but less than 90% of Target
• $(i)$ Effect on the financial position if Blaze acquires more than 50% but less than 90% of Target.
  • $(A)$ Pro forma Balance Sheet

To illustrate the financial impact of Blaze acquiring more than 50% of Target Shares, a pro forma Balance Sheet of Advance has been prepared based on its audited Balance Sheet as at 31 December 2008. The pro forma Balance Sheet assumes that Blaze acquires 60% of Target Shares and that no Target options are exercised during the Offer period:

Pro forma Balance Sheet Advance Energy Ltd

	Advance 31/12/2008 audited	Effect on Advance if Blaze acquires 60% of Target
	\$'000	\$'000
Total current assets	4,403	8,496
Total non-current assets	24,706	24,706
TOTAL ASSETS	29,109	33,202
Total current liabilities Total non-current liabilities	9,698 9,734	9,698 9,734
TOTAL LIABILITIES	19,432	19,432
NET ASSETS	9,677	13,770
Issued share capital	12,692	16,785
Reserves	4,444	4,444
Asset revaluation
Minority Interest
Accumulated losses	$-7,459$	-7,459
TOTAL EQUITY	9,677	13,770

$(B)$ Key Financial Impacts

The key financial impacts of Blaze acquiring control of Target are summarised below:

• Current shareholder loan in balance sheet of \$4,093m; $\bullet$
• No increase in liabilities; and
• Increase in share capital of \$4.093m.
• $(ii)$ Effect on capital structure if Advance acquires 60% of Target
• $(A)$ Issued capital

Assuming Blaze acquires 60% of the Target Shares on issue as at the date of this Bidder's Statement and issues Advance Shares as consideration for under the Offer, the total number of Advance Shares which would be on issue are in the table below.

The actual number of Advance Shares on issue will depend upon the number of acceptances of the Offer and the effect of rounding of fractional entitlements (which will be rounded up to the nearest whole number).

	60% Acceptances and no Target Options Exercised 1	60% Acceptances and all Target Options Exercised 2
Issued Advance Shares as at the date of this Bidder's Statement	118,798,222	118,798,222
Number of Advance Shares to be issued under the Offer	62,592 702	132,154,866
Issued Advance Shares following the Offer	181,390,924	250,853,088

Notes:

• 1. This represents the number of Advance Shares that would be issued based on the existing number of Advance Shares on issue and no Target Options being exercised during the Offer Period.
• $2.$ This represents the maximum number of Advance Shares that would be issued pursuant to the Offer, assuming all Target Options are exercised during the Offer Period. The exercise prices of the Target Options range from \$0.12 to \$0.25 per Target Option, and if all Target Options were exercised, Target would receive additional cash of approximately \$16.96 million from the payment of the exercise price of the Target Options.
• $(B)$ Ownership structure

The issue of Advance Shares to pay for Blaze's acquisition of Target Shares will impact upon Advance's substantial shareholders. Based on current shareholdings, the table below summarises the expected substantial shareholders of Advance on completion of the Offer:

	Current Holdings		Post offer Based on no Target Options exercised	Post offer Based on 60% acceptances and 60% acceptances and all Target Options exercised
	Number of
Shareholder	Advance	Percentage	Percentage	Percentage
	Shares
Bardev Pty Ltd	10,156,165	8.55%	5.60%	4.05%
A N Short/Fay Holdings Pty Ltd	16,458,599	13.85%	9.07%	6.56%
RP Martin	9,318,211	7.84%	5.14%	3.71%
G A Sklenka/Formaine Pty Ltd	6,805,357	5.73%	3.75%	2.71%
A J Carew-Reid	7,527,172	6.34%	4.15%	3.00%
	40,109,339	42.31%	27.71%	20.03%

Effect on Blaze of acquiring more than 90% of Target $(c)$

Effect on the financial position if Blaze acquires 100% of Target $(i)$

$(A)$ Pro forma Balance Sheet

To illustrate the financial impact of Blaze acquiring all Target Shares, a pro forma balance sheet of Advance has been prepared based on its audited balance sheet as at 31 December 2008. The pro forma Balance Sheet assumes that Blaze acquires all Target Shares.

Pro forma Balance Sheet Advance Energy Ltd

	Advance 31/12/2008 Advance if Blaze audited	Effect on acquires 100% of Target
	\$'000	\$'000
Total current assets	4.403	11,226
Total non-current assets	24.706	24,706
TOTAL ASSETS	29,109	35,932
Total current liabilities	9.698	9,698
Total non-current liabilities	9.734	9,734
TOTAL LIABILITIES	19,432	19,432
NET ASSETS	9.677	16,500
Issued share capital	12,692	19,515
Reserves	4.444	4,444
Asset revaluation
Minority Interest
Accumulated losses	-7.459	-7,459
TOTAL EQUITY	9,677	16,500

$(B)$ Key Financial Impacts

The key financial impacts of Blaze acquiring all Target Shares are summarised below:

• Current shareholder loan in balance sheet of \$6.823m;
• No increase in liabilities; and $\bullet$
• Increase in share capital of \$6.823m.
• $(ii)$ Effect on capital structure if Blaze acquires 100% of Target
• $(A)$ Issued capital

Assuming Blaze acquires all Target Shares on issue as at the date of this Bidder's Statement and issues Advance Shares as consideration for the above acquisition, the total number of Advance Shares which would be on issue are set out in the table below. The table sets out the number of Advance Shares which would be on issue, both if no existing Target Options are exercised and if all the existing Target Options are exercised. The exercise prices of the Target Options range from \$0.12 to \$0.25 per option, and if all Target Options were exercised. Target would receive additional cash of approximately \$16.96 million from the payment of the exercise price of the options.

	100% Acceptances and no Target Options Exercised 1	100% Acceptances and all Target Options Exercised 2
Issued Advance Shares as at the date of this Bidder's Statement	118,798,222	118,798,222
Number of Advance Shares to be issued under the Offer	104,321,170	173,883,334
Issued Advance Shares following the Offer	197,039,100	249,210,723

Notes:

• This represents the number of Advance Shares that would be issued based on 1. the existing number of Advance Shares on issue and no Target Options being exercised during the Offer Period.
• $2.$ This represents the maximum number of Advance Shares that would be issued pursuant to the Offer, assuming all Target Options are exercised during the Offer Period.
• $(B)$ Ownership structure

Blaze's acquisition of Target will impact the substantial shareholders of Advance. Based on current shareholdings, the table below summarises the expected substantial shareholders of Advance assuming compulsory acquisition of all Target Shares on completion of the Offer:

Current Holdings		Post offer Based on 100% acceptances and no Target Options exercised	Post offer Based on 100% acceptances and all Target Options exercised
Shareholder	Number of Advance Shares	Percentage	Percentage	Percentage
Bardev Pty Ltd	10,156,165	8.55%	4.55%	3.47%
A N Short/Fay Holdings Pty Ltd	16,458,599	13.85%	7.38%	5.62%
R P Martin	9,318,211	7.84%	4.18%	3.18%
G A Sklenka/Formaine Pty Ltd	6,805,357	5.73%	3.05%	2.33%
A J Carew-Reid	7,527,172	6.34%	3.37%	2.57%
	50.265.504	42.31%	22.53%	17.17%

If Blaze acquires 100% of Target (and assuming all existing and
proposed options in Target are exercised and accepted into the
Offer), former Target Shareholders will hold approximately 59.41% of
the issued shares of Advan