PERTH (miningweekly.com) – The directors of energy infrastructure business APA Group have unanimously recommended a near A$13-billion takeover offer from a consortium led by CK Infrastructure Holdings.
The A$11 a share offer was first flagged in June this year, with the consortium, which also includes CK Asset Holdings and Power Asset Holdings, revealing plans to divest APA’s interest in the Goldfields Gas Pipeline, Parmelia Gas Pipeline, Mondarra Gas Storage Facility and a standalone management team.
APA said on Monday that the company has now entered into a conditional implementation agreement with the consortium, with the directors of the company unanimously backing the offer in the absence of a superior proposal.
“Since listing in 2000, APA has been focused on delivering value and growing returns for its security holders. A dollar invested in APA at listing, with distributions reinvested, would have grown approximately 18.3 times,” said APA chairperson Michael Fraser.
“The offer made by CKI consortium is compelling. It is an all cash offer, representing a premium of over 30% to APA’s recent trading prices and gives certainty of value to security holders,” he said.
“In the absence of a superior proposal, and subject to an independent expert concluding that the schemes are fair and reasonable, and in the best interest of APA security holders, the board unanimously recommends that security holders vote in favour of the schemes, and all APA directors intend to vote their own security holdings in favour of the schemes.”
Depending on regulatory approvals, a security holder meeting is targeted for late November to consider the offer, while the implementation of the deal is targeted for mid-December.
In addition to security holder approval, the deal is subject to regulatory approvals, and court approvals.
A break fee of between A$50-million and A$130-million will be payable by APA depending on the conditions of the break, and a reverse break fee of A$50-million will be payable by the consortium in certain circumstances.