"Industry sources said PEP, the country's largest private equity firm, was considering a one-two knockout blow which could see it snap up both PacHydro's Australian assets and Infigen's operational and development pipeline.
"One option may be for Infigen to bid for the PacHydro assets and fund the deal via a significant placement of shares to PEP. The private equity firm, which has set up a special purpose vehicle called Greenswell Holdings, would then mop up Infigen's minority interests, should the target's board and shareholders agree to such a deal.
"Key to any deal would be the support of Infigen's 32.6 per cent shareholder The Children's Investment Fund Management, which has partner Philip Green on the renewables company's board.
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Takeover/merger speculation is always helpful to the share price. Stand by for a rise.
A listed vehicle holding both hydro and wind would be very attractive - and allow the wind development pipeline to proceed at speed. Personally, I would prefer a merger of equals.
DYOR
IFN Price at posting:
43.5¢ Sentiment: Buy Disclosure: Held
