Santos Takeover Bid Draws Government Scrutiny Amid Share Price Surge

June 16, 2025 12:24 PM AEST | By Team Kalkine Media

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Santos Takeover Bid Draws Government Scrutiny Amid Share Price Surge — Image source: shutterstock

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Highlights

SA government seeks approval role in proposed Santos acquisition

Focus remains on job security and company headquarters in South Australia

Santos shares surge after takeover bid announcement

The proposed acquisition of Santos (ASX:STO) by the Abu Dhabi National Oil Company (Adnoc) has prompted immediate attention from the South Australian government, as it seeks to safeguard state interests. With Santos headquartered in Adelaide, local authorities have expressed the importance of maintaining economic stability, preserving local jobs, and ensuring strategic oversight over vital energy infrastructure.

Tom Koutsantonis, South Australia's Energy and Mining Minister, responded swiftly to the news, stating that the government will engage directly with Adnoc to assess the implications of the deal. Highlighting existing legislative safeguards, he noted that ministerial consent is a legal requirement for any change in the controlling interest of a licence holder in the state. This legislative clause effectively gives the SA government the power to review and influence the outcome of the takeover, especially if it impacts critical regional assets.

Koutsantonis emphasized the broader responsibility to ensure that the acquisition aligns with the best interests of South Australians. "Our main objective at all times is safeguarding Santos jobs and retaining its headquarters in SA," he stated. Discussions with Adnoc are expected to focus on how the proposed transaction supports the local workforce and the continuity of strategic operations in South Australia.

The market reaction to the takeover news was swift. Santos shares jumped nearly 13% to trade at $7.85 at 11:28am AEST following the announcement. This uptick reflects investor optimism in response to Adnoc's offer, which values Santos shares at $8.89 each—a notable premium over the current trading price.

The bid marks a significant development in Australia's energy sector, involving a major international player expressing interest in acquiring one of the country's largest oil and gas companies. While the financial details suggest an appealing valuation, regulatory oversight and regional interests are likely to play a decisive role in determining the final outcome.

The potential acquisition of Santos (STO) underscores the growing strategic importance of Australian energy assets on the global stage, and the balancing act governments face in protecting national interests while enabling foreign investment. As the deal progresses, further updates are expected as Adnoc and local authorities continue negotiations under the purview of the SA government’s legal framework.

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