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Confusion over Santos takeover deal

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According to the latest Reuters report, the Harbour Energy's takeover of Santos Ltd has hit some uncertainty. Harbour recently announced that it is working with Santo’s top shareholders – China’s ENN Ecological Holdings and Hony capital – in order to seal a takeover deal for the Australian gas producer, however the amount of progress that has been made is unclear.

With regards to the takeover bid as a whole, Harbour, which proposed a US10.4 billion bid earlier this year, is close to completing its review of Santos’ books ahead of deciding whether to make its offer binding.

Santos Chief Executive, Kevin Gallagher reported “no issues raised” when questioned as to the progress of the review.

Harbour has since been working with ENN and Hony Capital, who together own 15.1% of Santos, with the aim of putting together a final proposal; a fact that was announced by Harbour in a statement to the Australian stock exchange: “Harbour is seeking to agree terms with each of ENN and Hony in order to put forward a final proposal for the acquisition of Santos.”

Work is clearly in progress, however the extent to which tangible progress has been made with these shareholders is indeterminate at this time; particularly in the case of ENN.

In a recent statement, ENN announced that it had reached a ‘tentative agreement’ with Harbour regarding the takeover of Santos. The agreement reportedly would allow ENN to retain an indirect investment in Santos.

While this deal would seem suggestive of progress, the existence of such a deal remains uncertain as Santos claims to be unaware of any agreement between ENN and Harbour.

According to Gallagher, “There’s been no contact between ourselves and ENN on that.”

Should this takeover deal go through, it will be the largest ever involving a company in Australia’s oil and gas sector.

Read the article online at: https://www.lngindustry.com/liquid-natural-gas/16052018/confusion-over-santos-takeover-deal/

 

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