Today's AFR:
Infigen Energy’s board unanimously recommended shareholders reject the 80¢ a share takeover bid made by UAC Energy, spoiling the $777 million offer from the Philippines linked investment company. UAC Energy sprang an unsolicited takeover offer on the renewable energy generator just hours after securing a 12.82 per cent interest through an aftermarket share raid early this month.
But Infigen looks set to fall into Spanish hands, with the board backing a superior 86¢ a share offer from the Spanish-listed utility, the largest wind power producer in the world. The $835 million offer, excluding debt, is a 7.5 per cent premium to the UAC offer.
Iberdrola had been working with Infigen for the best part of a year as the implementation agreement shows Iberdrola has been subject to a confidentiality agreement since July 2019.‘
‘In the absence of a superior proposal, the board is recommending security holders accept the Iberdrola offer, which is at a higher price and is less conditional overall than the UAC offer,’’ the company said yesterday.
It also warned investors that UAC’s bidder’s statement contained outdated information that was no longer correct.
RBC analyst James Nevin expects investors to accept the deal from Iberdrola, which he characterised as a very serious bidder with a €64.6 billion ($105.3 billion) market cap and plans for €10 billion a year of investment as it grows its renewables portfolio.
‘‘With Infigen [before Iberdrola’s indicative bid] having not traded above 86 cents per share since May 2017, The Children’s Investment Fund willing to accept 86 cents per share for 20 per cent of its holding, and the board recommending the offer, we think this takeover is likely to reach the 50 per cent acceptance condition,’’ he said.
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Ash here.
Thank you for your opinion, Mr Nevin. From the announcement of the Iberdrola bid, IFN has consistently traded well above the offer, with a lot of money from multiple sources publicly standing ready to buy above 86c.
Mr Market does not believe the current Ibedrola offer is the final price. Nor should holders.
IFN has traded lower in the last few days as deep pockets step back from soaking up stock to see what demand there is from others.
The answer is - plenty!
Either Iberdrola comes back with a higher bid or the offer will lapse, over-bid by the market. We shall see.
Ash
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