Takeovers Panel dragged into Santos-QGC quarrel

SANTOS has pulled the Takeovers Panel into its dispute over Queensland Gas Company’s failure to provide an independent valuation report in its target’s statement.

In a statement this morning, the panel said it had received an application from Santos, which claimed the report contained deficiencies.

Firstly, Santos argued it did not provide “sufficient information to enable QGC shareholders to properly assess the merits” of its offer. And secondly, it reiterated its argument that QGC failed to provide a recent expert’s report in relation to its reserves.

As a result, Santos is seeking a declaration of unacceptable circumstance and has asked the panel to order QGC to issue a replacement target’s statement.

The panel said it was appointing a panel to consider Santos’ request.

Last week, Santos chairman Stephen Gerlach argued that QGC shareholders deserved to know why an independent report was not included.

He said in refusing to provide the report, QGC has done a “major backflip” in light of its own failed bid for Sydney Gas earlier this year.

“This is a major reversal on the part of QGC,” Gerlach said. “If the absence of an independent expert’s report was a ‘major omission’ then, surely it must be now.”

QGC chairman Robert Bryan responded by telling shareholders at the company’s annual general meeting that they should form their own view as to the company’s worth.

Then on Monday, Santos announced it was extending the closing date of its $606 million takeover offer for QGC until after the Australian Competition and Consumer Commission releases its findings.

The hostile takeover bid had originally been due to expire on Friday, November 30. But under the extension, it will now close almost three weeks later on Tuesday, December 19.

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