Santos’s Board support for Harbour’s bid treading on uncertain waters
Date: 2018-05-18   Author: Dhananjay Punekar  Category: #news

Santos’s Board support for Harbour’s bid treading on uncertain waters

Harbour Energy, a U.S. based energy investment firm, is still doubtful over its plans to acquire Santos, a leading oil & gas producer, for nearly USD 13.7 billion. Sources cite that after nearly a month of diligence, the U.S. company has insisted that the bidding price for Santos will remain unaltered at the USD 4.98 price per share.

Chinese shareholders Hony and ENN, with a combined share of 15% in Santos, brought about a breakthrough post having signed a deal with Harbour that will help them retain their assets in Santos.

Reportedly, though the bid price has remained unchanged, the deal structure has been revised to quite an extent. As per the new agreement, Harbour Energy’s offer will be made in cash for all the investors of Santos that will also encompass Hony & ENN, excluding any fixed Australian dollar component. The revised offer also includes a proposal for Hony and ENN to roll over their current stocks into any new Harbour investment vehicle. However, analysts have projected that this offer is not likely to be a 1-for-1 trade.

With oil costs escalating by the day, reaching nearly USD 80 per barrel, some of the key executives of Santos are of the opinion that the current offer made by Harbour Energy has undervalued the company. According to Keith Spence, the current Chairman of Santos, the current value of the firm is expected to be highly dependent on the increasing oil costs. He was of the view that Harbour Energy’s bidding price for Santos is lower given the existing situation of the rising oil prices.  

Analysts have seemingly supported the statement, claiming that the bid price is not compatible with the oil costs as well as the company standards. They were of the opinion that a bid of nearly USD 7 could have been more attractive considering the present scenario. So far, it is being speculated that the board of Santos may, in all plausibility, reject Harbour Energy’s acquisition proposal.



About Author


Dhananjay Punekar

Dhananjay Punekar

Dhananjay currently works as a content writer at AlgosOnline. A post graduate in mathematics as well as business administration, he worked as a process executive in Infosys BPO Limited before switching his professional genre. Following his childhood passion, he opted fo...

Read More

More from Dhananjay


Post Recommendents

Superior Graphite inaugurates new plant in Hopkinsville, Kentucky
Author: Saipriya Iyer

In today’s globalized economic world, companies are increasingly looking at establishing new operations to strengthen business growth. This expansion helps offer lucrative market opportunities, new consumers and ...


SaaS startup Loop Returns raises $10 million in Series A investment
Author: Pankaj Singh

With growing online shopping traffic, the number of brands selling their products has also increased over the past few years. With more people shopping online, more brands are expanding themselves economically. However...


Adidas plans to pull the plug on two major robotic factories
Author: Pankaj Singh

In this era of automation and digitalization, keeping pace with the humongous deals and requirements has been stated to give the manufacturing companies a tough time. This leads to either the dissolution of the company...