Australia’s ‘Maze of Uncertainty’ Scuttles $40 Billion in M&A

Nearly $40 billion worth of major buyouts have collapsed in Australia this year — the most in 15 years — as regulatory hurdles and valuation disputes weigh on deals, Scott Murdoch reported for Reuters.

The deal's collapse has pushed the value of failed deals to the highest level since 2010. (Photo: Santos)

The latest casualty was an ADNOC-led consortium’s $18.7 billion bid for Santos, Australia’s second-largest gas producer, which was abandoned after disputes over potential capital gains tax liability tied to a Santos asset.

The deal, through ADNOC’s investment arm XRG, would have been the largest all-cash offer in Australian history, including Santos’s net debt.

Analysts said the transaction also faced likely pushback from Australia’s Foreign Investment Review Board (FIRB).

Its collapse has pushed the value of failed deals to the highest level since 2010, according to LSEG data, raising concerns about the viability of large-scale transactions in Australia’s increasingly strict regulatory climate.