The Santos Ltd. Logo atop Santos Place constructing, which homes the corporate’s workplace, in Brisbane, Australia, on Monday, Dec. 11, 2023.
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Abu Dhabi’s National Oil Company has walked away from its $19 billion offer for Australia’s Santos, ending months of hypothesis over what would have been one of many nation’s largest power offers.
The consortium, which incorporates Abu Dhabi sovereign wealth fund ADQ and funding agency Carlyle, made the $19 billion indicative offer for Santos in June, however confirmed on Wednesday that it’s going to not proceed with a binding takeover.
“It’s over,” a supply acquainted with the matter instructed CNBC. “The reality is, during the process, Santos was inflexible,” the supply added. CNBC understands the XRG-led consortium had key considerations round worth, tax, and the timeliness of disclosure.
The supply additionally described the Santos negotiation staff as “unrealistic” and stated that this was “not the outcome” Abu Dhabi’s XRG hoped for.
XRG stated a “combination of factors” derailed its third try at securing Santos, which Abu Dhabi had hoped would bolster its ambitions to export LNG into the Asia markets. It’s understood different points, similar to an absence of communication and inflexibility over capital features tax, and up to date media reports over environmental risks that the consortium was not beforehand conscious of, had been a part of the broader points that derailed the deal.
Although talks with Santos have collapsed, the consortium remains to be anticipated to discover alternatives in Australia’s power sector. Sources acquainted with the matter additionally emphasised that regulatory approvals, and unions, weren’t a priority, calling the choice “purely commercial.”
XRG, which has an enterprise worth of $80 billion, recently took management of ADNOC’s listed subsidiaries, in a transfer to strengthen its monetary place to hunt out world power offers.
Santos, headquartered in Adelaide, has been the topic of repeated takeover curiosity as world demand for pure gasoline accelerates alongside the power transition. The firm performs a key function in supplying LNG to Asian consumers, and has been a strategic goal for worldwide traders.
CNBC has reached out to Santos for remark.