Brookfield Infrastructure Partners has sweetened its buyout of Sydney-listed Prime Infrastructure by offering Prime shareholders an additional cash payment of A$0.20 (€0.14; $ 0.20) for each share they hand over in connection with the merger.
The cash will be paid in addition to the 0.24 shares of Brookfield Infrastructure Partners each Prime shareholder will receive, Brookfield said in a press release.
The sweeetened offer will bring the total value of the merger to A$5.21 per share for Prime shareholders, Brookfield said.
On August 23, Brookfield which already owned 40 percent of Prime, offered to buy the remaining 60 percent of the firm it did not already own in a deal valuing it at A$1.6 billion.
Brookfield said it has held discussions with Prime's largest shareholders and believes they will vote in favour of the buyout offer. The offer will represent a 33 percent premium to Prime’s share price before the takeover, Brookfield said.
Brookfield originally acquired its 40 percent stake in Prime in late 2009, as part of a A$1.8 billion recapitalisation of the debt-laden former Babcock & Brown satellite, known at the time as Babcock & Brown Infrastructure (BBI). Following the recapitalisation BBI, rebranded as Prime Infrastructure and decreased its leverage from a pre-transaction level of 98 percent to 68 percent.
The recapitalisation also gave Brookfield equity stakes in eight assets including European ports operator Euroports, rail infrastructure business Western Australia, New Zealand’s Powerco and UK ports operator PD Ports, among others.
Brookfield Infrastructure Partners is managed by Toronto-based Brookfield Asset Management, which has been rapidly scaling up its presence in infrastructure over the last two years.
Besides infrastructure, Brookfield manages property, power generation and other specialty funds, with total assets under management of $90 billion.