US based Harbour Energy offers USD 10.8 billion for Santos Ltd, raising its bid ones again.
ProxyPetroleum Energy consider the offer too low. It does not reflect the true potential in Santos Ltd. Even if the offer seems fair based on current earnings and conventional valuation models we at Proxy believe that the real, soon to be realized, valuation metric lies in the forward price curve for oil. We see a stronger and sustained price for oil and LNG going forward.
In our opinion a fair value for Santos Ltd should be in the vicinity of AUD 8 dollars per share.
ProxyPetroleum Energy is currently invested in Santos Ltd.
Hans Berglund, CIO