Santos shares slide on XRG takeover update
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More news: Shares in oil giant Santos dropped after the company said no agreement or in-principle agreement has yet been reached in regards to its proposed $30 billion takeover by an XRG-led consortium. XRG is a subsidiary of Abu Dhabi's state-owned oil company Adnoc.
Santos shares were down 2.8% to $7.74 at 12:55pm AEST, having returned 15.8% since the turn of the year. The wider energy sector was down 1.62%.
XRG-led $30b bid for Santos unlikely to reach agreement by end of due diligence period
The news: Fossil fuel giant Santos has flagged that it does not expect to sign a binding agreement to be acquired by a consortium led by Abu Dhabi’s XRG, for an implied equity value of $30 billion, before the end of an exclusive due diligence period.
The context: Earlier this month, Santos extended the XRG consortium’s period for exclusive due diligence by two weeks to 22 August to allow more time to progress towards a scheme implementation agreement.
Santos told the exchange that “discussions and final confirmatory due diligence have continued to be collaborative”, no agreement or in-principle agreement on acceptable terms for a binding scheme implementation agreement have been reached.
XRG also told Santos that it would not be in a position to sign a binding agreement until requisite final approvals are received. XRG expects this would take at least four weeks from when due diligence is completed and scheme implementation agreement terms are agreed in principle.
Santos has also delayed the release of its half-year results to 25 August to "align with the conclusion of the XRG Consortium's exclusivity period" and will provide a further update on discussions at the time.
The source: ASX
