Santos receives takeover offer from Abu Dhabi-led consortium

Santos has received a non-binding $8.89 per share cash offer from the XRG Consortium, led by XRG P.J.S.C., a subsidiary of Abu Dhabi National Oil Company (ANDOC), alongside Abu Dhabi's sovereign wealth fund ADQ and US private equity firm Carlyle.

The proposal, which values the energy giant at a 28% premium over its June 13 closing share price of $6.96, marks the consortium's third bid this year.

The latest offer, described as the "final" non-binding indicative proposal, follows two confidential bids on March 21 at $8.00 per share and March 28 at $8.60 per share.

The consortium has requested Santos enter a process and exclusivity deed to restrict competing bids before proceeding with confirmatory due diligence and negotiating a scheme implementation agreement (SIA). Santos confirmed that it's negotiating the terms of this deed and an associated confidentiality deed with the consortium.

Santos' board confirmed that, subject to agreeing on acceptable terms for a binding SIA, it intends to unanimously recommend that shareholders vote in favour of the proposed transaction, provided no superior proposal emerges and an independent expert concludes the deal is fair, reasonable, and in the best interests of shareholders.

Goldman Sachs and JB North & Co are acting as financial advisers to Santos with Rothschild & Co acting as an independent board adviser. Herbert Smith Freehills Kramer, meanwhile, is acting as legal adviser to Santos.

Senator and acting shadow treasurer James Paterson said the Coalition noted the proposed acquisition of Santos, which operates "critical energy infrastructure in Australia."

Paterson said the role of the Foreign Investment Review Board will be important, but added, ultimately, the treasurer must be clear with the Australian people about whether the transaction is in the national interest and explain why.

"The Australian public has a right to know what this deal means for energy security, for Australian jobs, and for the long-term control of our key economic assets," Paterson said.

"The Coalition will consider the details carefully as they emerge, but we believe national interest must be more than a checkbox.

"It must be a serious and robust test, especially in a strategic sector like energy."