Australia's APA enters bidding war for Singapore Power's AusNet, offers A$9.96b

[BENGALURU] Australian energy infrastructure firm APA Group made a non-binding proposal on Tuesday to buy peer AusNet Services for A$9.96 billion (S$9.77 billion), entering a bidding war with Canadian investor Brookfield Asset Management.

The deal comes as mergers and acquisitions activity in Australia has spiked over the past year, as record-low interest rates encourage institutional investors and companies to chase higher valuations.

The offer came in just a day after an affiliate of Brookfield proposed to acquire AusNet for A$9.57 billion. AusNet, partly owned by Singapore Power, opened its books to the affiliate and granted due diligence to it on an exclusive basis.

Under APA's cash-and-stock deal, AusNet shareholders would get A$2.60 per share, representing a 10.2 per cent premium to its last close.

APA said in a statement it had approached AusNet earlier this month with a confidential proposal of A$2.32 apiece, but added that it had also informed the energy infrastructure firm last week of its intention to make a revised proposal.

"APA is disappointed that AusNet has purported to enter into a period of exclusivity with Brookfield for effectively eight weeks, notwithstanding AusNet's knowledge of the pending revised, and potentially superior proposal, from APA," it said.

Shares of AusNet, which owns and operates Victorian electricity transmission network, soared nearly 20 per cent to finish at a record high on Monday following the Brookfield offer.

REUTERS

READ MORE: AusNet in talks with Brookfield for A$2.50 apiece conditional offer