Australia’s Santos rejects Scepter takeover offer

Australia’s Santos, the operator of the GLNG project, said it has rejected a 7.1 billion Australian dollar (US$5.1 billion) takeover offer from a fund backed by sovereign investors and the ruling families of Brunei and the United Arab Emirates.

Santos has on Tuesday received an indicative, highly conditional and non-binding proposal from Scepter Partners, on behalf of the managed funds of its core stakeholders, to acquire all of Santos for a cash consideration of A$6.88 per share.

“The Santos Board has met to consider the proposal and decided to reject it. The proposal is considered to be opportunistic in nature and does not reflect the fair underlying asset value of the company,” Santos said in a statement.

According to the statement, the proposal was also subject to numerous conditions, some of which would be “adverse to Santos’ continued evaluation of other alternatives in its current strategic review process.”

“Santos announced on 21 August that it would conduct a thorough strategic review of all options to restore and maximise shareholder value. The strategic review is ongoing, and will continue to consider all proposals which deliver appropriate value and certainty for shareholders,” the statement added.

Santos shares rose more than 20 percent in early trade on Thursday. The company’s shares were up 16.2 percent at A$6.32 each, at the close.