A consortium led by XRG, a lower-carbon energy and chemicals investment company under Adnoc, announced on Wednesday that it has withdrawn its indicative offer and will not proceed with a binding offer for Santos, an Australian energy group.

In a statement the consortium said that while it“maintains a positive view of the Santos business, a combination of factors, when considered collectively, have impacted the consortium's assessment of its indicative offer”.

“Following a comprehensive evaluation, and taking into account all commercial factors and the terms of the Scheme Implementation Agreement (SIA) required by the Santos Board, the Consortium has determined that it will not be proceeding with the proposed transaction,” the statement said.

In June, the consortium had led an $18.7 billion takeover bid for Santos as it sought to build a global natural gas giant.

At the time, Santos' board said it planned to unanimously recommend Adnoc's offer to shareholders if it can agree on the takeover terms.

Adelaide-based Santos has operations in Australia, East Timor, Papua New Guinea and the United States, and is a major supplier of liquefied natural gas in Australia and Asia. Other members of the consortium include ADQ, an Abu Dhabi sovereign wealth fund, and global investment firm Carlyle.

“The consortium was prepared to undertake new long-term commitments to Australian energy production that would deliver meaningful benefits to domestic gas consumers and enhance regional energy security,” the XRG statement said.

As a strategic long-term investor, XRG said it remains dedicated to pursuing value-accretive opportunities across gas & LNG, chemicals, and energy solutions, and has a rich and deep pipeline of investment opportunities which we will continue to pursue.

- with inputs from agencies

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