$19 billion Santos takeover in limbo: Four-week decrease-off date extension looms as talks proceed

Australia’s energy player Santos is facing a multi-week extension of the decrease-off date for the negotiations surrounding an $18.7 billion non-binding indicative offer made by a consortium spearheaded by XRG, a subsidiary of Abu Dhabi National Oil Company (ADNOC), which entails Abu Dhabi Model Preserving Company (ADQ) and global investment agency Carlyle. 

After XRG proposed to assign Santos’ all typical shares for a cash offer value of $5.761 per share by a device of association, the Australian player confirmed a direction of and exclusivity deed with the ADNOC-led consortium, which secured uncommon due diligence access for six weeks.

The firm claims that the XRG consortium, which substantially accomplished due diligence, has now no longer chanced on the relaxation that will motive it to withdraw its indicative proposal; thus, confirming its commitment to working constructively to entire due diligence and to agree on a binding transaction.

Because of this, Santos consented to the XRG consortium’s inquire of for an extension of the exclusivity length except August 22, 2025, relating to the device and exclusivity deed dated June 27, 2025.

“Since that time, Santos and the XRG consortium non-public continued to work collectively to entire due diligence and progress the aptitude transaction, in conjunction with the negotiation of phrases of a binding device implementation agreement (SIA),” elaborated the Australian agency.

Although discussions and supreme confirmatory due diligence non-public continued to be collaborative, the companies non-public now no longer yet reached an agreement on acceptable phrases of a binding SIA. 

The takeover expose is in accordance with XRG’s low-carbon agenda and 5-year industry notion to connect an built-in gas and liquefied pure gas (LNG) industry with 20–25 million a lot per annum (mtpa) skill by 2035.

Santos claims that the XRG consortium has underlined that that is doubtlessly now no longer ready to label a binding SIA although the phrases and supreme due diligence had been out of the manner, because it is yet to make the requisite final approvals required to enter exact into a binding transaction.

Primarily based solely totally on the ADNOC-led consortium’s indications, these approvals are anticipated to take four weeks to make, assuming an expedited direction of, potentially longer otherwise, from the time that every due diligence is entire and the phrases of the SIA are agreed in principle.

Because of this, Santos does now no longer query the events to enter exact into a binding SIA by August 22, when the exclusivity length below the device deed expires. Meanwhile, discussions with the XRG consortium remain ongoing.

Whereas explaining that its shareholders develop now no longer must take any motion, Santos underscores that there’s no longer a straightforward job that the duo will enter exact into a binding SIA on phrases acceptable to every companies or that the aptitude transaction will proceed.