The indicative offer from Harbour comprises a cash offer price of US$4.70 per share (AU$6.13) plus a special dividend of US$0.28 per share (AU$0.37) which is expected to be fully franked.
Santos has established a board committee – made up of Chairman Keith Spence, Managing Director Kevin Gallagher and the chair of each of the board’s standing committees – to consider the approach and make recommendations to the Santos board.
“The Santos board considers that, based on the indicative offer price of AU$6.50 per share, it is in the interests of shareholders to engage further with Harbour,”? read the statement released by Santos this morning.
As such, Harbour has entered into a confidentiality agreement with Santos to allow for confirmatory due diligence.
The offer is still subject to a number of conditions, including:
- Regulatory approvals, including approval from the Foreign Investment Review Board
- A minimum of 15 per cent (max. 20 per cent) of existing Santos shares outstanding rolling over into unlisted shares of a special purpose company (Harbour Rollco) that will remain invested in Santos
- Entry into binding debt financing commitments
- Completion of confirmatory due diligence.
Rothschild & Co., J.B. North & Co and Deutsche Bank are acting as financial advisors to Santos and Herbert Smith Freehills is acting as legal advisor.