Santos Ltd. has granted a consortium led by Abu Dhabi National Oil Co. PJSC (ADNOC) more time to conduct due diligence for a potential acquisition of the Australian oil and gas company.
The “process and exclusivity deed” signed June 27 between Santos and the consortium of sovereign investor Abu Dhabi Development Holding Co., Carlyle Group and ADNOC’s global investment arm XRG PJSC has now been extended to August 22, Santos said in a statement on its website.
The parties announced a non-binding indicative proposal June 16, with Santos saying it intended to endorse to its shareholders the cash purchase offer of $5.76 per share.
Announcing the extension of the due diligence review, Santos said, “The XRG consortium has now substantially completed due diligence in relation to the potential transaction under the process and exclusivity deed dated 27 June 2025. The XRG consortium has confirmed it has not discovered anything to date that would cause the XRG consortium to withdraw its indicative proposal and has confirmed its commitment to working constructively with Santos to complete the due diligence promptly and agree on a binding transaction”.
“To complete due diligence and progress a binding transaction, the XRG consortium has requested a two-week extension to the Due Diligence and Exclusivity Period under the Process Deed”.
The initial exclusivity period was to last six weeks from June 27. “The exclusivity provisions include customary ‘no shop’, ‘no talk’, ‘no due diligence’ and ‘notification’ obligations that apply during the exclusivity period”, Santos said June 27.
“A fiduciary exception applies enabling the Santos board to deal with potentially superior proposals from competing acquirers from the date that is four weeks from today”.
Confirming the extension, XRG said separately, “There remains strong alignment between both parties on the strategic rationale for the potential transaction, and the process to date has been constructive and is ongoing”.
“Together, the consortium partners bring extensive operational expertise, investment capacity and the long-term vision required to develop and scale complex energy projects and low-carbon solutions”, XRG added.
The consortium’s proposal is for the purchase of all ordinary Santos shares. The offer price had been increased from two confidential offers of $5.04 per share and later $5.42 per share, both made in March, Santos said when confirming the proposal in June.
The consortium intends to grow Santos’ natural gas and liquefied natural gas (LNG) business to support demand in Australia, the Asia-Pacific and beyond, XRG said at the time.
Earlier in June XRG announced a goal of building a top-five integrated gas and LNG business with a capacity of 20-25 million metric tons a year by 2035.
Santos operates in Australia, Papua New Guinea, Timor-Leste and the United States.
Santos previously held merger talks with compatriot Woodside Energy Group Ltd., which they terminated early 2024. “Following an initial exchange of information, sufficient combination benefits were not identified to support a merger that would be in the best interests of Santos shareholders”, Santos said in a statement then.
To contact the author, email jov.onsat@rigzone.com
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