Santos Ltd (ASX:STO) tumbled on Thursday after a consortium led by the Abu Dhabi National Oil Company (ADNOC) dropped its $18.7 billion bid for the Australian gas producer, stating that terms for a deal could not be met.
Santos’ shares slumped as much as 13.6% to A$6.610, reaching three-month lows. The stock was also among the biggest weights on the ASX 200, which fell 0.8%.
The ADNOC-led group, called the XRG Consortium, had offered to buy Santos in June, for $5.76 (A$8.89) per share in cash. Santos said in a statement on Thursday that it was willing to finalize a deal at $5.626 a share.
The XRG consortium– which consisted of ADNOC’s overseas unit, the Abu Dhabi sovereign fund ADQ, and private equity firm Carlyle, pulled its offer for Santos on late-Wednesday, as the two failed to reach consensus on a price.
The deal marks the third major takeover bid for Santos that has failed to go through in the past seven years. Santos had rejected a $10.8 billion bid from Harbour Energy in 2018, and had also declined talks with bigger Australian gas rival Woodside.
The XRG offer valued Santos at about A$36.4 billion including debt.
Santos said on Thursday that the XRG Consortium maintained a positive view of its business and management team.
Santos’ board is now expected to face heightened shareholder pressure over a sale of the gas giant.
Source :
https://www.investing.com/news/stock-market-news/santos-shares-slide-14-after-adnoc-drops-19-bln-bid-4243675
