A consortium spearheaded by Adnoc’s investment branch XRG PJSC, which also involves Abu Dhabi Development Holding Co. and Carlyle Group Inc., proposed $5.76 (A$8.89) per share for Santos, the company announced on Monday. This represents a 28% premium over Friday’s closing price.
Santos’ stock has surged in recent months amid rumors that Middle Eastern energy giants, including Adnoc and Saudi Aramco, were contemplating bids.
This acquisition will strengthen Adnoc’s goal of becoming a key supplier of liquefied natural gas, one of the most rapidly expanding fossil fuel markets. Santos possesses LNG assets in both Australia and Papua New Guinea.
Adnoc, a proactive player in recent transactions, has recently established XRG, which is actively seeking gas and chemical investments with a target enterprise value of $80 billion.
“The suggested transaction aligns with XRG’s strategy and ambition to develop a leading integrated global gas and LNG enterprise,” stated the Adnoc unit. The company aims to “invest in Santos’ growth and further the development of its gas and LNG-focused operations,” it added.
Santos has long represented an appealing target for competitors. Back in 2018, the Adelaide-based firm turned down several offers from US-based Harbour Energy Ltd., while discussions with Woodside Energy Group Ltd. fell apart last year. Some stakeholders have encouraged Santos to separate its sought-after LNG assets from its oil operations in Alaska and domestic gas endeavors in Australia to capitalize on higher valuations.
Santos’ board plans to unanimously recommend the offer to shareholders.
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(Edited by : Juviraj Anchil)
