Santos 15% shareholder cap review

18 September 2007 | 05:40 Code : 15296 Geoscience events
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South Australian Premier Mike Rann says the State Government is continuing....

  South Australian Premier Mike Rann says the State Government is continuing to negotiate with Santos about the possible lifting of the shareholder cap, with a decision to be announced by the end of the month. In May this year the government announced a review of the 28-year-old law limiting individual share ownership in Santos to 15 percent. This review was initiated at the specific request of the company, which believes that the cap now restricts Santos’s growth potential. Mr. Ran said the cap was introduced in 1979 to prevent a takeover by Alan Bond. “There were well-founded concerns at the time about how the state’s interests in having a secure and continuous supply of gas might be compromised if control of Santos and the Cooper Basin, then the sole source of gas into South Australia, fell into the hands of such an individual,” Mr Rann said “The cap served South Australia well in this period, but South Australia today receives gas from a number of sources, and is at the centre of a national gas hub, taking supply from Victoria through the SEAGAS pipeline, and with plans to connect Mamba – Adelaide to the Queensland system,” he said. Mr. Ran said the downside of a removal of the cap would be the potential for a takeover by interstate or overseas interests. “While there would be a major benefit to Santos shareholders in the removal of the cap, there are also risks for South Australia that need to be addressed. “The approach of the South Australian government will be driven unashamedly by maximizing benefits to South Australia,” he said.

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