Australia’s Santos rejects $10.9bn takeover bid from Harbour Energy

Bloomberg

Santos Ltd. rejected Harbour Energy Ltd.’s $10.9 billion final offer and terminated talks.
The Australian oil and gas producer said its independent directors, managing director and chief executive officer unanimously decided to reject the proposal because it didn’t represent the full value of the company. Oil prices and shares of its peers traded in Australia have rallied 14 percent and 18 percent, respectively, since the initial proposal, Santos said.
Harbour Energy said in a statement it was disappointed in the decision, and criticised Santos and its board for insufficient engagement on valuation and an unwillingness to bridge the gap.
“Harbour must be frustrated that a sudden unexpected rally in oil prices has been almost perfectly timed to help thwart their plans,” Saul Kavonic, an analyst with Wood Mackenzie Ltd. said in an email. “Especially if oil prices drop again, then Santos could reemerge as attractive for acquisition at the recent Harbour bid levels.”
US-based Harbour earlier this week improved its bid by 4.6 percent and indicated it could be raised further if Santos expanded its oil-hedging program, the Australian company said in a statement.