Australia-listed fund manager Babcock & Brown has beaten Macquarie Bank to get the board of Alinta, a local energy utility company, to endorse an A$8 billion ($6.66 billion) takeover offer.
Babcock & Brown is leading a consortium that comprises three of its listed funds alongside Singapore Power, a strategic partner that owns gas and electricity assets in Singapore and has investments in Australia and Taiwan.
Babcock & Brown raised its previous offer for Alinta to A$16.06 per share, comprising both cash and securities, to ward off competition from Macquarie Bank. Macquarie’s takeover interest in Alinta stirred controversy in Australia, because of its long-standing role as the company’s financial advisor.
Babcock & Brown’s offer values Alinta at A$16.46 a share including tax credits, trumping Macquarie A$15.80 per share all-cash bid. Babcock’s offer has improved by more than A$1.00 a share since an initial recommended proposal of 30 March, after “taking into account the increase in offer terms and the price appreciation in Babcock & Brown’s funds’ securities,” according to a statement by Alinta. The bid’s cash component is worth $8.93 a share.
The offer represents a premium of 49 percent to the average price of Alinta shares in the 30 days prior to the announcement of a potential buyout of the company on 9 January.
Alinta chairman John Akehurst said: “The B&B/SP Offer delivers outstanding shareholder value, choice for all shareholder groups and a high degree of completion certainty.”
Both parties have signed a revised agreement that is subject to regulatory approvals. The Babcock & Brown-led consortium said it expects to complete the takeover by the end of August.