Australian power grid owner AusNet has accepted a A$10.2 billion ($7.66 billion; €6.63 billion) equity bid from a consortium led by Brookfield Asset Management.
The company announced it had agreed to the terms of a binding proposal and entered into a scheme implementation deed with the consortium, which also comprises Sunsuper Superannuation Fund, Alberta Investment Management Corporation, the Investment Management Corporation of Ontario and Healthcare of Ontario Pension Plan.
As part of the scheme of arrangement, AusNet shareholders are set to receive A$2.65 per share, plus additional consideration if the scheme is not implemented before 31 March 2022.
AusNet’s board of directors has unanimously recommended that shareholders vote in favour of the scheme in the absence of a superior proposal. Singapore Power, which owns 32.74 percent of the company, has informed AusNet it is in favour of the scheme.
Brookfield’s offer places the enterprise value of the company – which owns and operates Victoria’s electricity transmission network and a portion of the state’s power and gas distribution networks – at roughly A$17.8 billion.
In a statement, AusNet chairman Peter Mason said: “For the last several weeks the board has been extremely focused on ensuring a competitive process. This has resulted in a binding proposal from Brookfield at a price that provides full value to all AusNet shareholders.”
In a separate statement, Brookfield managing partner Stewart Upson said: “We intend to make AusNet an even stronger competitor in the Victorian renewable energy market and to use this platform to compete for connections across Australia…We intend to hold this business in our portfolio for the very long term. We have the means and desire to invest significant capital to accelerate AusNet’s growth to facilitate the transition required to meet Australia’s decarbonisation goals.”
Brookfield was granted exclusive due diligence in September for a period of eight weeks following a A$9.6 billion bid for AusNet. At the time, the Canadian firm’s unsolicited, indicative, non-binding and conditional proposal of A$2.50 cash per share withstood a A$10 billion revised rival offer from ASX-listed energy infrastructure firm APA Group.
In a statement noting Brookfield’s latest bid, APA said: “APA still considers the AusNet business to be highly attractive. While APA has received strong support from investors in both AusNet and APA Group for its proposed acquisition, APA will continue to remain financially disciplined.”