The private-equity-backed Harbour Energy boosted its takeover offer for Santos Ltd., bidding US$10.8 billion for the Australian oil and gas producer.

The latest offer, announced May 21, values Santos at $5.21, or A$6.95, per share, an 11% premium to the company's previous closing price. The proposal is conditional on Santos hedging more of its oil-linked production in 2018 and 2019. Harbour has also indicated that it would increase its offer even more, to the U.S. dollar equivalent of A$7 per share, if Santos agrees to hedge 30% of its oil-linked production in 2020.

Santos announced in early April that it would consider a US$10.4 billion bid from Harbour, an offer analysts said pointed to improving views on the global market for LNG. The revised proposal comes amid a rise in oil prices and is the fifth time in nine months Harbour has increased its offer, according to Reuters.