Adnoc’s $19 Billion Santos Bid Exposes Australian Energy Dilemma

One of the biggest foreign takeovers in Australian history will force regulators and politicians to weigh who controls critical energy infrastructure against the need to address a looming domestic gas shortfall.

Santos Ltd.’s board agreed this week to back a $19 billion takeover bid from a group led by Abu Dhabi National Oil Co., a cash-rich but state-owned company that is seeking to become a top producer of liquefied natural gas. Yet the ASX-listed company’s shares are still at a significant discount to the offer, reflecting investor uncertainty around approval by Australia’s regulators, who have a history of blowing up multibillion-dollar deals.