MELBOURNE (Reuters) - Blame it on Trump, Iran or Venezuela. Rising oil prices combined with a heavy debt load killed the world’s biggest private equity oil and gas industry deal last week.
Harbour Energy left Australia empty-handed after a year of chasing gas producer Santos Ltd (STO.AX), missing out on Santos’ stakes in three liquefied natural gas projects in Australia and Papua New Guinea as it sought to become a major LNG player.
The U.S. firm, backed by EIG Global Energy Partners, was forced to bid against itself five times, including twice over one weekend, until it made a final offer of $10.8 billion, up more than 50 percent from its first approach last August.
“The grievance runs deep and it’s heartfelt,” said a person in the Harbour camp.
Harbour Chief Executive Linda Cook, a former senior executive at Royal Dutch Shell (RDSa.L), was on a plane last Tuesday when she heard Santos had rejected its sixth offer, worth about A$6.95 a share. She declined to comment for this story.
Harbour’s disappointed chairman, Blair Thomas, was already back in Washington, DC, and didn’t mince words.
“There was insufficient engagement with Santos on valuation, no meaningful attempt by Santos to discuss a realistic price which could supported by any reasonable set of technical and commercial assumptions, and an unwillingness by their Board to explore means of closing the gap between the offer and their expectations,” he said in a two-page statement.
Thomas believed by the end of a weekend of back and forth between
