XRG-led consortium withdraws $18.7bn offer to acquire Santos

Core Viewpoint - The XRG-led consortium, which includes Abu Dhabi Development Holding Company (ADQ) and Carlyle, has officially withdrawn its indicative offer of $18.7 billion to acquire 100% of Santos, an Australian oil and gas producer, after evaluating commercial factors [1]. Group 1: Offer and Withdrawal - The consortium's decision to withdraw follows an extensive evaluation and consideration of commercial factors [1]. - Santos had previously reached an agreement to extend the Process and Exclusivity Deed to facilitate the finalization of the Scheme Implementation Agreement (SIA) [2]. - The XRG Consortium had confirmed that no issues were found during due diligence that would lead to a withdrawal [2]. Group 2: Offer Details and Expectations - Santos expected to enter an SIA at a proposed offer price of $5.62 per share if a binding proposal was received by September 19 [3]. - The XRG Consortium notified Santos of its decision to withdraw its indicative proposal and will not proceed with the potential transaction [3]. Group 3: Consortium's Position and Previous Offers - Santos emphasized the consortium's unwillingness to embrace a fair distribution of risk, particularly regarding regulatory approvals and domestic gas supply commitments [4]. - XRG stated its disappointment in not moving forward but highlighted its responsibility and focus on creating shareholder value and long-term growth [5]. - Santos had previously rejected two earlier proposals from the consortium priced at $5.04 and $5.42 per share [5]. Group 4: Historical Context - Santos previously turned down a $10.8 billion offer from Harbour Energy in 2018 and walked away from negotiations with Woodside Energy last year, which could have led to a combined company valued at A$80 billion [6].