Santos Ltd., Adelaide, has received a binding, conditional proposal from Harbour Energy Australia Pty. Ltd., Perth, to acquire all of Santos shares by way of a scheme of arrangement.
The revised offer follows an indicative and conditional proposal received in early April that was followed by a 5-week due diligence process.
Harbour’s revised bid has not changed the offer price of $4.98/share, which values Santos at $13.7 billion, but there are changes to the transaction structure.
The changes include:
• A US dollar offer of cash consideration for shareholders other than major shareholders ENN and Hony, with no fixed Australian dollar component.
• An offer to ENN and Hony to roll-over their existing Santos shares into a Harbour investment vehicle and subscribe for new shares. This option is not available to other Santos shareholders.
The revised bid is subject to conditions, including completion of final confirmatory due diligence and entry into a scheme implementation deed between Santos and Harbour, which requires the transaction to be recommended by the independent directors of the Santos board. It also includes Foreign Investment Review Board and shareholder approval.
The independent directors of Santos will now consider the revised proposal and report to shareholders in due course, but Santos stresses there is no certainty the revised Harbour proposal will result in an offer for Santos that the board will recommend to its shareholders.
