Firms extend merger talks

SANTOS and Oil Search have extended the due diligence period for their proposed merger to Sept 13.
The companies announced on Aug 2 that Santos would acquire all of Oil Search shares.
Santos in a statement yesterday said: “we refer to our announcement that Santos and Oil Search are entering into confidentiality agreements and a period of exclusive mutual due diligence regarding the proposed merger via an arranged scheme under which Santos will acquire all of the shares in Oil Search for a consideration of 0.6275 new Santos shares for each Oil Search share held.
“Santos and Oil Search have agreed to extend the exclusive due diligence period Sept 13.”
Oil Search said: “Subject to each party completing due diligence on the other to its satisfaction, and the entry into a merger implementation agreement, the Oil Search board intends to unanimously recommend shareholders vote in favour of the revised proposal, in the absence of a superior proposal and subject to the conclusion of an independent expert that the revised proposal is in the best interests of Oil Search shareholders.”
Meanwhile, Petroleum Minsiter Kerenga Kua said work done by Oil Search nationwide should be maintained even after the merger.
“We have had our moments of agreements and disagreements with Oil Search Ltd but nobody can deny the fact that Oil Search has played a huge role in Papua New Guinea,” he said.
“In a merger, per say, Oil Search will be lost in a merger with Santos and will be subsumed into a new entity with consequences.
“Because the Oil Search is based in PNG, the prime minister has emphasised that PNG’s national interest must be factored into the merger arrangements. We have been asked to monitor the national interest components and consequences of the merger.
“There is nothing we can do about the merger because it is a free market and normal business taking its course.
“Any resulting entity from the merger must always remember the Oil Search culture that has been benefited Papua New Guineans considerably.”