Asciano backs US$6.8b takeover
Print Edition
AUSTRALIAN logistics giant Asciano said it was recommending a A$9.05 billion (US$6.8 billion) takeover deal between two rival local and international suitors, breaking up the company’s ports and rail assets.
Yesterday’s announcement ended a bidding war for Asciano, a major Australian rail, freight and ports operator, between a consortium led by Canada’s Brookfield Infrastructure Group and a group led by Australia’s Qube that includes a Chinese sovereign wealth fund. Under the joint bid, Asciano is valued at A$9.28 per share, or A$9.05 billion.
Qube will split the ports business with Brookfield, whose consortium members include government wealth fund the Qatar Investment Authority.
Another grouping, which includes China’s CIC Capital Corp, Singapore’s state investment fund GIC, the Canada Pension Plan Investment Board, investment group Global Infrastructure Partners, and the British Columbia Investment Management Corp, will acquire the rail operations.
Qube said yesterday that the arrangement was a “highly attractive outcome for all stakeholders” which would be “transformational” and have “significant benefits” for the firm. The Sydney-based logistics and infrastructure firm also announced a A$800 million equity raising to fund its bid.
The deal is subject to shareholder and regulatory approval, including from the Australian Competition and Consumer Commission and the nation’s Foreign Investment Review Board.
“If I was an Asciano shareholder, I would be pretty happy with the price I got, because I don’t believe under normal trading conditions ... you would be able to extract that kind of value in the lifetime of you holding it unless you got taken over,” IG Markets strategist Evan Lucas said.
The two consortiums previously made separate bids, with the joint-tender application given the go-ahead by financial regulator the Australian Securities and Investment Commission. Asciano shareholders are expected to vote on the deal in early June.
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