Investing.com -- Santos Ltd. shares dropped 11.9% on Thursday, erasing A$3 billion ($2 billion) from the Australian oil and gas company's market value after a proposed $19 billion takeover deal collapsed.

The Abu Dhabi National Oil Co.'s XRG unit, which led the potential acquisition, walked away from negotiations late on Wednesday after the companies failed to reach agreement on key terms.

The failed talks mark the third unsuccessful attempt to sell Santos, putting additional pressure on the company to improve its valuation and shareholder returns.

The sharp stock decline represented the largest single-day drop for Santos in five years, pushing its market capitalization below $15 billion. The abandoned deal follows months of discussions between the parties.

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