Azzet reports on three ASX with notable trading updates today.
Santos soars on double-whammy updates
While all energy stocks were dragged higher at the open on the back of a 7.5% spike in the oil price to US$73 a barrel, Santos (ASX: STO) received an extra kicker to its share price following revelations it was the subject of a US$18.7 billion takeover offer.
Shares in the oil and gas producer were up around 14% this morning after it received a non-binding indicative proposal from a consortium (XRG) led by Abu Dhabi National Oil Company (ADNOC), along with Abu Dhabi Development Holding Company (ADQ) and global private equity firm Carlyle.
What clearly excited the market was the mouthwatering 28% premium to the stock’s last closing price of $6.96.
Today’s release also notes the following premiums:
- 30% premium to 1-week volume weighted average price (VWAP)
- 34% premium to 1-month VWAP
- 44% premium to 3-month VWAP
- 39% premium to 6-month VWAP
There’s no guarantee XRG’s latest offer – the third bid it has made for Santos since March 2025 - will get up, but assuming satisfactory terms can be agreed upon, the board intends to unanimously recommend the deal to shareholders.
It’s understood that XRG Consortium's willingness to pay such a high premium for Santos is driven by its ambitions of becoming a global player in the LNG market.
Given the magnitude of XRG’s latest bid, which has been described as its "final non-binding indicative offer, analysts doubt whether any competing bids for Santos will be forthcoming.
Meanwhile, XRG is keen to lock in an exclusivity arrangement while due diligence is conducted.
The deal will need to clear regulatory hurdles.
None the least of these is Australia’s Foreign Review Investment Board (FIRB) which given the stock’s control of critical energy infrastructure in Australia may create something of an overhand for the deal.
Approval will also be required from authorities in the U.S. and Papua New Guinea.
Adding a menacing backdrop to today’s bid by XRG is the spike in oil prices to multi-week highs with Israel and Iran air strikes creating market angst over oil exports from the Middle East.
A successful bid would see XRG gain control of two Australian liquefied natural gas operations - Gladstone LNG on the east coast and Darwin LNG in the north.
However both stakes in PNG LNG and the undeveloped Papua LNG are seen as the jewels within the Santos operation that the Abu Dhabi state-run XRG values the most highly.
Santos is also developing an oil project in Alaska, Pikka which are expected to start producing mid-2026.
Regulatory approvals aside, the offer will need at least 75% support from Santos investors to proceed.
Santos said in February that its underlying annual profit fell nearly 16% in 2024 and the company cut its dividend by 41%.
Santos has a market cap of $25.4 billion; the share price is up 4.8% in one year and up 22% in the last month.
The stock appears to be in a medium-term rally confirmed by multiple indicators.
Consensus is Moderate Buy.
Tourism Holdings skyrockets on takeover bid
Shares in Kiwi-based Tourism Holdings (ASX: THL) were up a staggering 50% at the open after the world’s largest commercial recreational vehicle (RV) rental operator told the market it had received a conditional takeover proposal.
A consortium led by private equity firm BGH Capital and the family interests of Luke and Karl Trouchet have made a non-binding all-cash offer of NZ$2.30 per share – which values the company at NZ$508 million.
Today’s offer price represents a 58% premium to its last traded price on the NZX of NZ$1.46.
Subject to several conditions including due diligence, financing, and board recommendation, the bid could proceed either via a scheme of arrangement or takeover offer.
The consortium has also flagged that it is open to alternative structures, including those providing control without requiring 100% ownership.
The ASX mid-cap stock operates rental brands Maui, Britz, Apollo, Mighty, Hippie, and Cheapa Campa, plus manufacturing businesses, retail brands, retail dealerships, a travel technology business, and tourism attraction operations.
At the same time as the takeover bid was announced, Tourism Holdings also told the exchange that BGH Capital has acquired a relevant interest in 19.99% of its shares on issue.
It’s understood that the Trouchet brothers currently hold an 11.795% stake in the stock.
While Luke Trouchet is the CEO of Apollo Motorhomes, his brother Karl is the company’s chief financial officer.
Given his involvement in the consortium bid, Luke is expected to take a leave of absence from his executive role with Tourism Holdings and will not be involved in board or subcommittee meetings convened to consider the deal.
Today’s proposal follows a challenging period for Tourism Holding which in February revealed a half-year result which saw its after-tax profit fall 36% to $25.3m.
The company claimed that the poor 1H FY25 result was due to factors beyond its control; namely poor consumer confidence in the demand for recreational vehicles, and recent geopolitical and tariff developments impacting travel sentiment.
ASX falls after fessing-up to lost market confidence, flags further delays to CHESS
Shares in embattled ASX (ASX: ASX) were down around 6% at noon after the share market operator disclosed the regulator’s ongoing dissatisfaction with the pace of needed internal change - which has been a point of contention for some time.
In one breath CEO Helen Lofthouse reiterated the regulator’s clear dissatisfaction with the pace of change within the bourse operators, which has arguably tarnished market confidence in the stock.
However in the next breath, Lofthouse did little to bolster the market’s perception of the stock, by admitting that the ASX has not ruled out further delays and costly blowouts to the trouble-plagued upgrades to its CHESS computer system.
The ASX is continuing to work towards 2026 delivery of its first stage upgrade to the CHESS computer system, which handles the transfer of money and shares between buyers and sellers.
Estimated project costs during the first stage of upgrades are now between $105 and $125 million, while stage two costs – due for delivery in 2029 – are expected to cost between $270 and $320 million.
What triggered both the regulator (ASIC) and the Reserve Bank (RBA) to enforce regulatory action on the stock were CHESS incidents just before Christmas 2024 that occurred due to a breakdown in the system’s memory allocation.
This breakdown resulted in the company’s inability to complete batch settlements for cash equities that day.
ASIC chairman Joe Longo told the market that enforcing regulatory action was the result of “repeated and serious failures” at ASX.
Regulatory action triggered a compliance assessment and inquiry into ASX licence obligations, which allow it to operate on the markets and conduct clearing and settlement activity.
ASIC also believes a series of technical failures could have been caused by broader governance issues.
Earlier this year the RBA which co-regulates the ASX, accused the company of failing to comply with operational risk standards, and described “serious issues of concern that warranted immediate action”.
ASX has a market cap of $13.3 billion; the share price is up 21% over one year and down 5% in the last month.
The stock appears to be in a long-term uptrend, as confirmed by multiple indicators.
Consensus is Hold.
This article does not constitute financial or product advice. You should consider independent advice before making financial decisions.
