Santos shares soar over 15% on ADNOC-led group's $18.7 billion takeover bid
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XRG-Led Consortium Bids $18.7 Billion for Australia's Santos
Above: The Santos Place building in Brisbane, Australia, on Dec. 11, 2023. Image copyright: Ian Waldie/Bloomberg via Getty Images
The Spin
Narrative A
The XRG-consortium's takeover bid is a great opportunity for both Santos and Australia. The 28% premium on offer is a significant boost for company shareholders, while the consortium's pledge to maintain Santos' Australian roots and develop its industry will ensure that Australia remains a leader in regional and domestic energy security. There is, frankly, no better offer on the table.
Narrative B
This takeover is short-sighted at best and a disaster at worst. Energy markets are increasingly fragile at this current time, meaning that the last thing Australia needs is to lose a major energy supplier to a foreign government-owned entity for a lackluster price, which this proposal threatens to do. This deal, therefore, will likely fall foul of compromising the national interest.