1. Homepage
  2. Equities
  3. Australia
  4. Australian Stock Exchange
  5. Santos Limited
  6. News
  7. Summary
    STO   AU000000STO6

SANTOS LIMITED

(STO)
  Report
Delayed Australian Stock Exchange  -  05/25 02:10:52 am EDT
8.230 AUD   +0.73%
01:58aEurope, Asia gas buyers switching to long-term supplies to beat volatile prices
RE
05/24Banks, miners lift Australian shares to near 3-week high
RE
05/24SANTOS : Update - Notification of buy-back - STO
PU
SummaryQuotesChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector newsMarketScreener Strategies

Santos $6 bln takeover of Oil Search gets tepid backing from independent expert

11/10/2021 | 10:34pm EDT

* Merger ratio undervalues Oil Search, expert says

* Expert backs deal despite valuation concerns

* Acting CEO says most shareholders see deal's benefits

MELBOURNE, Nov 11 (Reuters) - Oil Search shareholders are set to vote on Dec. 7 on a merger with Santos Ltd after gaining approval from a Papua New Guinea court and a mixed endorsement from an independent expert.

If it goes ahead, the A$8.8 billion ($6.5 billion) takeover of Oil Search would create a global top 20 oil and gas company and make Santos the largest shareholder in Papua New Guinea's biggest resource project, the PNG LNG project, run by Exxon Mobil Corp.

Oil Search's appointed independent expert firm, Grant Samuel, said the merger was in the best interest of Oil Search shareholders as it would boost funding for its $3 billion Pikka oil project in Alaska and improve gas development prospects in Papua New Guinea.

It said Santos' offer, which will give Oil Search shareholders a 38.5% stake in the merged group, did not fully reflect Oil Search's underlying value, which it said was worth 43%-44% of the total estimated value of the merged group.

"There is clearly a risk that the funding and other strategic benefits do not fully compensate shareholders for this dilution," Grant Samuel said in a report attached to the merger document going to shareholders.

It concluded nevertheless that Oil Search shareholders were likely to be better off if the deal went ahead, given growing funding constraints facing the industry in the drive away from fossil fuels.

Oil Search acting chief executive Peter Fredericson defended the merger ratio, saying it took into account relative contributions from earnings, reserves and production along with the strategic benefits, such as much better access to capital markets for the enlarged group.

"At the end of the day there are going to be one or two out there who are going to say it's not enough in the deal that we've got, but the majority of shareholders we've spoken to see the strategic benefit of putting these two businesses together," Fredericson told Reuters.

Based on Santos' closing share price of A$6.78 on Thursday, its offer valued Oil Search at A$4.25 a share, slightly above Oil Search's close, indicating investors expect the deal to go ahead.

($1 = 1.3563 Australian dollars) (Reporting by Sonali Paul; Additional reporting by Anushka Trivedi in Bengaluru; Editing by Ramakrishnan M, Sherry Jacob-Phillips and Gerry Doyle)


© Reuters 2021
Stocks mentioned in the article
ChangeLast1st jan.
LONDON BRENT OIL 0.32% 114.3 Delayed Quote.45.50%
OIL SEARCH -2.42% 4.04 End-of-day quote.0.00%
SANTOS LIMITED 0.73% 8.23 Delayed Quote.29.48%
WTI 0.29% 110.721 Delayed Quote.45.58%
All news about SANTOS LIMITED
01:58aEurope, Asia gas buyers switching to long-term supplies to beat volatile prices
RE
05/24Banks, miners lift Australian shares to near 3-week high
RE
05/24SANTOS : Update - Notification of buy-back - STO
PU
05/23Australian shares subdued as tech, healthcare offset mining gains
RE
05/23S.Korean court dismisses plea to block loans to $3.6 bln Australian gas project
RE
05/23S.Korea court dismisses plea to block loans to $3.6 bln Australian gas project
RE
05/22Miners lift Australian shares; new Labor PM Albanese sworn in
RE
05/18Australia's gas producers cash in on global energy security fears
RE
05/18Australian shares track global equities lower; tech stocks slide
RE
05/18AUSTRALIA'S LNG INDUSTRY TAKES RISKY : Russell
RE
More news
Analyst Recommendations on SANTOS LIMITED
More recommendations
Financials (USD)
Sales 2022 8 199 M - -
Net income 2022 2 698 M - -
Net Debt 2022 3 622 M - -
P/E ratio 2022 6,45x
Yield 2022 4,23%
Capitalization 19 581 M 19 581 M -
EV / Sales 2022 2,83x
EV / Sales 2023 3,22x
Nbr of Employees 3 786
Free-Float 92,3%
Chart SANTOS LIMITED
Duration : Period :
Santos Limited Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends SANTOS LIMITED
Short TermMid-TermLong Term
TrendsNeutralBullishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus BUY
Number of Analysts 16
Last Close Price 5,82 $
Average target price 6,99 $
Spread / Average Target 20,0%
EPS Revisions
Managers and Directors
Kevin Thomas Gallagher Chief Executive Officer, MD & Executive Director
Anthea Mckinnell Chief Financial Officer
Keith William Spence Non-Executive Chairman
David Banks Chief Operating Officer
Hock Goh Independent Non-Executive Director
Sector and Competitors
1st jan.Capi. (M$)
SANTOS LIMITED29.48%19 424
SAUDI ARABIAN OIL COMPANY23.37%2 353 862
SHELL PLC45.89%221 379
TOTALENERGIES SE17.52%145 252
PETROCHINA COMPANY LIMITED13.54%136 651
EQUINOR ASA43.54%113 341