[ad_1]
Infrastructure investor Infratil (IFT) has rejected a $ 5.4 billion takeover offer from Australia’s largest pension fund, AustralianSuper.
On Wednesday, investors were apparently unwilling to believe that would be the end of the matter, with Infratil’s stock price soaring 20% to $ 7.30.
Any acquisition of Infratil would have ramifications, as the company is the main shareholder of Wellington Airport and TrustPower and owns half of Vodafone NZ. It also has large investments in energy, including 65.5% of the NZX-listed wind farm operator Tilt Renewables, which Infratil announced only this week that it was putting on the block.
A statement from Infratil’s board to the NZX on Wednesday said it received a non-binding, incomplete, indicative and confidential initial offer from AustralianSuper to acquire IFT through a scheme agreement on October 18, 2020 for cash consideration from NZ. $ 4.69 and an in-kind distribution of 0.2210 shares of Trustpower Limited. This implied a total offer value of NZ $ 6.40 per IFT share. That offer was subsequently revised on November 27, 2020 to increase the cash consideration to NZ $ 5.79. The revised proposal confirmed by AustralianSuper implies a total offer value of NZ $ 7.43 per share of IFT, based on a closing price of NZ $ 7.43 per share of Trustpower as of December 8, 2020 (proposal) . This proposal represents a premium of 22.2% over the IFT closing price on December 8, 2020.
“The Board hired legal experts (MinterEllisonRuddWatts) and financial advisers (Goldman Sachs) and formed a Committee of Independent Directors in October to assist in evaluating the proposals.
“The Board reviewed the valuation and proposed structure and unanimously rejected both proposals as substantially undervaluing IFT’s high-quality, unique portfolio of assets on a control basis. The Board also notes important conditions related to Board approvals of Foreign Investment Review and Foreign Investment Office in Australia New Zealand and finds that there are other aspects of the proposal that are not attractive to IFT shareholders, including distributing Trustpower Limited shares without recognizing a control premium and avoiding the need to make a takeover bid for that business.
“The IFT Board will consider any proposal to maximize shareholder value, but given the significant deficiencies in the Proposal, no additional commitment is planned at this time,” the statement said.
IFT President Mark Tume said the board “periodically assesses portfolio construction and profitability expectations.”
“We have a long and successful track record as active administrators of the Infratil platform, and recent examples include the continued success of CDC’s data centers, the proposed acquisition of Qscan, and the strategic review of Tilt Renewables. As of December 8, 2020 , Infratil had delivered a total return to shareholders of 18% per year since its listing in 1994 and has an expected annual return to our shareholders of 11% to 15% in the long term.
IFT CEO Marko Bogoievski said: “Both proposals were unsolicited and materially underestimate our important renewable energy and digital infrastructure platforms. We expect some of the additional value to be demonstrated in the near term with the recently announced strategic review of Tilt Renewables, which will continue, and the continued appreciation of the value of CDC’s data centers. ”
