Ann: Third Supplementary Target's Statement to Iberdrola Offer, page-29

Today's AFR. Excerpts.

UAC to foil a bid for full control of Infigen

Angela Macdonald-Smith

Philippines-controlled UAC Energy has increased its stake in Infigen Energy to 20 per cent and made it clear it wants to remain a material shareholder, even after ceding the $893 million takeover battle for the wind farm owner to rival Iberdrola.

The increase in UAC’s stake rules out the possibility that it would sell its holding to Iberdrola and taking the Spanish player easily over the 50 per cent control threshhold.

UAC chairman Anton Rohner said the takeover offer from the group, which is controlled by Philippinesbased Ayala Corporation, was aimed at securing a material stake in Infigen and not necessarily at getting control.

‘‘We are pleased to have met our objective, and look forward to supporting Infigen’s future growth,’’ he said.

Jose-Maria Zabaleta, chief development officer of AC Energy, the Ayala subsidiary that controls UAC, said Infigen provided an attractive means of increasing exposure to renewables in Australia, something that would be enhanced under Iberdrola’s ownership.

‘‘With Iberdrola expected to become Infigen’s largest security holder, we believe the outlook for our investment has further strengthened,’’ he said.

UAC’s stake in Infigen is worth about $178 million based on Iberdrola’s offer price. The company has already made a healthy paper profit on its stake, having bought shares on average for 79.3¢ apiece, nearly 14 per cent below the latest 92¢ offer from the giant Spanish utility. Iberdrola has so far secured 40.98 per cent of Infigen, which owns battery storage and a gas power generator as well as wind farms.

It has only inched towards 50 per cent since securing the interest of Infigen’s largest shareholder, Londonbased TCI Funds, and increasing its offer a second time.

Iberdrola has been urging Infigen shareholders to accept its offer, now the only one available, and is also buying on market up to the bid price. The offer, which has already secured foreign investment approval, is due to close on August 7.

UAC let its 86¢-a-share offer for Infigen lapse last Friday. It had flagged in its latest bidder’s statement the possibility that it would not sell its interest to Iberdrola but buy more shares to take its stake up to 20 per cent.

Under Australian takeover regulations, UAC can’t make a fresh offer for Infigen for four months, and it can’t move above a 20 per cent holding for six months.