Infratil Ltd, the biggest shareholder in Australian alternative energy group Energy Developments Ltd., is supporting a A$431 million takeover bid a group affiliated to private equity firm Pacific Equity Partners and has pledged a 19.99% stake.
Greenspark Power Holdings, which is owned by entities advised by PEP, has offered A$2.75 a share for Energy Developments and claims to have already garnered support from holders of 42.4% of the target’s stocks, including Infratil, whose total holding is 32%. Shares of Energy Developments jumped 11% to A$2.68 on the ASX today.
The deal would provide an A$86 million windfall for Infratil, which has been selling non-core assets including airports and is in talks to buy New Zealand assets owned by Shell Group, including a chain of petrol stations and a stake in New Zealand Refining. Energy Developments, which taps fuel sources including methane from landfills, has been the subject of four proposals in as many months.
“Infratil believes that A$2.75 per share represents fair value for ENE and its shareholders,” chief executive Marko Bogoievski said
Under a pre-bid agreement with Greenspark, Infratil has made a commitment for its stake, requiring it to accept the offer within five business days of it becoming unconditional. The proposal may yet be stymied by the target company’s directors, who have pooh poohed other proposals to acquire the company.
"The latest offer is now under close consideration and the company will provide shareholders with further advice in due course," Energy Developments said in a statement.
The company has received an independent valuation range of A$3.17 and A$4.09 per share and has previously shot down a proposal from Archer Capital that may have amounted to A$2.80 a share.
