A. SREENIVASA REDDY (ABU DHABI)
A consortium led by XRG, the international investment arm of the Abu Dhabi National Oil Company (ADNOC), has made a “non-binding, indicative” proposal to acquire 100% of Santos, a leading Australian oil and gas producer.
In a statement issued on Monday, Adelaide-based Santos said it had received the offer on June 13, 2025. The XRG consortium — comprising XRG, Abu Dhabi Development Holding Company (ADQ), and US-based Carlyle — has proposed a cash offer of US$5.76 (A$8.89) per share, valuing the company at approximately US$18.72 billion.
The offer represents a 28% premium over Santos’ last closing share price of A$6.96 on June 13, and premiums of 30%, 34%, 44%, and 39% over the one-week, one-month, three-month, and six-month volume-weighted average prices (VWAP), respectively.
The latest proposal follows two earlier confidential and non-binding offers from the consortium — one on March 21, 2025 at US$5.04 (A$8.00) and another on March 28, 2025 at US$5.42 (A$8.60).
The Santos Board has indicated its support for the deal, stating, “It intends to unanimously recommend that Santos shareholders vote in favour of the transaction, in the absence of a superior proposal and subject to an independent expert concluding that the transaction is fair and reasonable.”
However, the proposal remains conditional. It is subject to confirmatory due diligence by the consortium and the negotiation and execution of a binding Scheme Implementation Agreement (SIA) with Santos. Regulatory approvals would also be required from the authorities.
Goldman Sachs and JB North & Co are acting as financial advisers to Santos, with Rothschild & Co serving as the independent board adviser. Herbert Smith Freehills Kramer is acting as the company’s legal adviser.
XRG was officially launched in November 2024 as ADNOC’s global investment platform, with an initial enterprise value of over $80 billion. Its board recently approved a five-year business plan (2025–2030), aiming to transform XRG into one of the world’s top five integrated gas and LNG players, with a target of 20–25 million tonnes per annum of LNG capacity by 2035.
XRG is actively expanding its footprint through strategic acquisitions and partnerships, including recent engagements in the United States (Rio Grande LNG), Mozambique, Egypt, Azerbaijan, and Turkmenistan.
In a statement, XRG said the consortium aims to build on Santos’ strong and longstanding legacy as a trusted and reliable energy producer, unlocking additional gas supply for Santos’ customers and strengthening domestic and international energy security.
“The proposed transaction is aligned with XRG’s strategy and ambition to build a leading integrated global gas and LNG business,” the statement said.
The XRG consortium has engaged J.P. Morgan as its financial adviser and Linklaters and Allens as legal advisers.
The XRG-led consortium intends to maintain Santos’ headquarters in Adelaide, as well as its brand and operational footprint in Australia and key international operating hubs. “We will work closely with the existing management team to accelerate growth and support local employment and the communities where Santos operates,” XRG said.
The consortium also aims to invest in Santos’ growth and further development of its gas and LNG-focused business, which will provide reliable and affordable energy and low-carbon solutions to customers in Australia, the Asia Pacific, and beyond.
Carlyle, a Washington-based investment firm with an office at Abu Dhabi Global Market (ADGM), is a major player in the private equity space. ADQ is a sovereign wealth fund of the Abu Dhabi government.