Australian oil and gas producer Santos announced that its board intends to support an US $18.7 billion non‑binding takeover bid from a consortium led by Abu Dhabi’s National Oil Company (ADNOC), through its investment arm XRG, together with Abu Dhabi Development Holding Company (ADQ) and private equity firm Carlyle.
They have offered US $5.76 (A$8.89) per share, marking a 28 % premium on Santos's closing price, after two earlier confidential bids of US $5.04 and US $5.42 per share in March.
The board said it plans to unanimously recommend the offer, assuming acceptable terms are agreed in a binding scheme implementation agreement, subject to no better proposal emerging.
ADNOC-led XRG consortium has entered exclusive due diligence negotiations and would require at least 75 % shareholder approval.
The bid aligns with XRG’s strategy to build a leading global gas and LNG business, leveraging Santos’s assets including LNG operations in Australia and Papua New Guinea.
Regulatory approval is required from Australia’s FIRB, ASIC, and agencies in PNG and the U.S., with analysts noting FIRB review of Santos’ critical infrastructure may pose a significant risk.
The offer follows Santos’s aborted merger discussions with Woodside last year, and comes after a 16 % drop in its underlying profit in 2024 and a 41 % dividend cut in February.
Analyst Saul Kavonic said a competing bid is unlikely given ADNOC’s capacity to pay such a premium.
Founded in 1954 and headquartered in Adelaide, Australia, Santos is a leading oil and gas producer, operating across Australia, Papua New Guinea, Timor-Leste and the U.S. It develops LNG, domestic gas, and oil projects. In 2024, Santos reported a nearly 16 % fall in underlying profit and cut its dividend by 41 %, making it a takeover target energynow.com .
ADNOC (Abu Dhabi National Oil Company) is the state oil company of Abu Dhabi, one of the world’s major integrated energy groups.
XRG Launched in late 2024, XRG is ADNOC’s US $80 billion investment arm. It focuses on lower‑carbon energy, LNG, chemicals, and renewables. Its goal is to grow into a top‑five global gas and LNG business with 20–25 Mtpa capacity by 2035.
ADQ (Abu Dhabi Development Holding Company) is a sovereign holding company established to drive diversification and invest in strategic sectors such as energy, infrastructure, and food.