Infigen Energy (ASX: IFN) has headed off a hostile Philippine takeover bid by recommending shareholders spurn that earlier offer and accept a higher cash offer from a Spanish energy giant, Iberdrola.
Through a deal with Infigen’s largest holders of its stapled securities, Iberdrola has already sewn up 20% of Infigen.
Earlier this month UAC Energy Holdings, 75%-owned by giant Philippines conglomerate Ayala Corporation, snapped up 12.82% of the target through an on-market raid and then followed up with all-cash offer of $0.80 per stapled security, a deal worth $777 million.
At the time, Infigen advised shareholders to take no action while directors studied the takeover proposal.
The board has now issued a recommendation that shareholders accept the higher Iberdrola cash offer of $0.86 per stapled security worth A$835 million — and reject UAC’s offer.
Infigen also revealed it has been involved in an “extended period of engagement” with the Spanish company.
Infigen owns three wind farms in New South Wales (one near Wellington, the other two around Lake George outside Canberra) and one in Western Australia.
Iberdrola is listed on the Madrid Stock Exchange and describes itself as the “number one producer of wind power” and one of the world’s biggest electricity groups by market capitalisation.
The Spanish company supplies electricity to almost 100 million people in Spain, Scotland (Scottish Power), the United States, Brazil, Mexico, Germany, Portugal, Italy and France. It holds assets in excess of €122 billion (A$200 billion).
Iberdrola aims to become world’s biggest wind energy provider
The statement from Infigen said its largest security holder — the Children’s Investment Master Funds and CIFF Capital UK, collectively known as TCI Funds — has agreed to sell its 20% holding of stapled securities to the Spanish bidder, subject to several conditions.
Iberdrola said the offer “is the result of a long friendly relationship between the Iberdrola group and Infigen”.
The Spanish company already owns the 320-megawatt Port Augusta Renewables Energy Park now under construction in South Australia. If this offer is successful, it will add Infigen’s 670MW wind generation assets.
Iberdrola said the takeover offer is consistent with its strategy to become the largest renewable energy player in the world, reaching installed capacity of 33 gigawatts.
Its asset mix now stands at 17GW onshore wind, 1GW offshore wind, 13GW of hydro and 1GW solar generation.