Santos bid is rejected

MELBOURNE - Queensland Gas said its board unanimously rejected the A$606 million ($683 million) takeover bid from Santos, calling it inadequate.

Shareholders should also reject Santos' A$1.26 a share offer, which is below the current stock price, Brisbane-based Queensland Gas told the Australian Stock Exchange.

Santos, Australia's largest natural gas producer, has been seeking to add to its gas reserves.

"The timing of the Santos offer was no coincidence - Queensland Gas was on a roll," said chairman Bob Bryan.

"The increasing premium reflected in the increasing share price should be retained by Queensland Gas shareholders and not handed on a platter to a third party."

Queensland Gas shares rose as much as 2.5 cents yesterday afternoon.

- BLOOMBERG