
Global energy company holds firm in Santos takeover bid
NATURAL gas producer Santos Ltd is just a few steps away from being acquired by a global energy investment company.
Santos, which operates and owns 30 per cent of the Santos GLNG plant on Curtis Island, announced on Thursday it had received a binding conditional proposal from Harbour Energy Australia to acquire 100 per cent of its shares.
Harbour is offering 84.9 per cent of Santos shareholders $US4.98 in cash per share as part of the acquisition.
The remaining 15.1 per cent of the company is owned by Chinese firms ENN and Hony, who are backing the takeover bid and will be offered the ability to roll existing shares into a Harbour investment vehicle.
The new offer is a restructuring of the bid Harbour made to Santos in April, before it undertook a five-week due diligence process.
But to the surprise of some analysts, the $US4.98 price being offered by Harbour is the same as the offer it made before Santos opened its books.
That price, about $A6.50 at the time, was 28 per cent higher than Santos's closing price of $A5.07 on March 29 - but now falls short of what many shareholders were hoping to receive in a second offer, given a recent hike in oil prices.

The news of the tough offer led to Santos's shares dropping 1.9 per cent on Thursday to $A6.20, below the offer price.
The decision on whether to accept the offer will now be considered by the independent Santos directors.
If the board signs off on the acquisition, it will go to the Federal Government's Foreign Investment Review Board, which may have concerns about Harbour's commitment to the domestic gas market.
If the deal clears that hurdle, it will need the approval of 75 per cent of Santos shareholders before it can go ahead.
The Santos board is telling shareholders to take no action at this time.
Harbour Energy, an EIG Global Energy Partners investment vehicle, only made its first acquisition in 2017 - but it has the backing of investment banks JP Morgan and Morgan Stanley.
Santos and Harbour representatives would not comment on the offer yesterday.