Santos Limited (ASX: STO) has officially announced the signing of a definitive sale agreement with Kumul Petroleum Holdings Limited, granting Kumul a 2.6% stake in PNG LNG. The total purchase consideration, valued at AU$576 million in cash along with the assumption of approximately AU$160 million in project finance debt, forms the basis of this agreement. The completion of the Sale Agreement, set for no later than 31 December 2023, is dependent solely on approval from the PNG competition regulator.
Kumul has initiated a partial payment of AU$80 million into escrow as part of the purchase consideration, with additional pre-payments scheduled until completion. Additionally, Santos has provided Kumul with a call option to secure an additional 2.4% stake in PNG LNG, with a cash cost of AU$524 million, contingent upon specific conditions. The terms align with a previous offer from Kumul, which expired along with exclusivity arrangements on 27 September 2022.
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