Woodside, page-269

AUST Business today (extract):
SANTOS AND WOODSIDE MAY NOT BE GOING IT ALONE FOR TOO MUCH LONGER

With Santos and Woodside Energy trading below their North American peers, the two local resources giants are back in focus surrounding a potential buyout.
North American groups such as ConocoPhillips and Chevron are ascribed far higher valuations and more broadly, many believe it makes sense for the world’s largest oil companies to consolidate the global market.
Any move would come hot on the heels of the consolidation already seen in the global pandemic, where Santos paid $21bn for its listed rival Oil Search and Woodside purchased BHP’s Petroleum business.
But the challenge for Santos and Woodside is that they are sometimes avoided by institutional investors that want to tick all the boxes from an ethical investing perspective because they are producers of fossil fuels.
If a major doesn’t buy Woodside or Santos, another option is the pair get together.

The understanding is that Woodside has weighed up a merger before.
A tie-up would be unlikely to create concern from the Australian Competition and Consumer Commission.
Santos is trading at about nine times its earnings and Woodside 12 times, so they are not too far apart on price when talking about a scrip deal. And the pair could gain funding benefits by being together.
But the argument against a move is that Santos would want more for its business than Woodside is prepared to pay, and Woodside’s focus is expansion in America whereas Santos is more skewed to the domestic gas market…….