AST - AusNet Services

[skc]

Re: SPN - SP Ausnet

SPN had been looking quite resilient. 8% drop this morning. I couldn't see any news or announcements to "explain" this drop.

The drop is explained by the 10% spike on Friday's close. I think it has something to do with careless movements by funds due to index rebalancing or the recent cap raising.

 

[RottenValue]

Re: SPN - SP Ausnet

Just giving back the big jump on Friday - some insto buy late that jumped the price by 9%

 

[System]

On August 5th, 2014, SP Ausnet (SPN) changed its name and ASX code to AusNet Services (AST).

 

[divs4ever]

Brookfield Makes $7 Billion Bid for Australian Power Company

Brookfield Makes $7 Billion Bid for Australian Power Company By Bloomberg

Brookfield Makes $7 Billion Bid for Australian Power Company

au.investing.com

DYOR

i hold AST ( bought as SPN ) and SKI ( and recently sold SYD , thanks for the freebies MQG )

i assume FIRB will wave these deals through ( despite the security issues of foreigners owning big chunks of the grid )

just as well i bought some NZ power companies as well

 

[divs4ever]

Confirmation of Proposal to AusNet Services APA Group (ASX: APA)

announces that it has made a non-binding indicative proposal to the Board of AusNet Services Ltd (“AusNet”) (ASX: AST) to acquire all the issued shares in AusNet (the “Superior Proposal”) by way of a scheme of arrangement for $2.60 per share in cash and scrip1.
The proposal would bring together two high quality businesses and create a listed flagship Australian group with the scale and capability to accelerate the $20 billion growth in electricity transmission infrastructure needed to support the decarbonisation of Australia’s economy. APA notes the announcement from AusNet yesterday of an indicative, non-binding and highly conditional proposal made by Brookfield Asset Management (together with its affiliates and related managed vehicles, collectively, “Brookfield”), (the “Brookfield Scheme”). APA confirms that on 1 September 2021 it approached AusNet with a confidential non-binding indicative proposal to acquire all of the issued shares in AusNet by way of scheme of arrangement (the “Original Proposal”) for a consideration of $2.32 per share.
APA and AusNet had engaged in discussions about the Original Proposal and APA had made AusNet aware on Thursday 16 September 2021 that it intended to make a revised proposal. APA canvassed AusNet’s major shareholders prior to approaching AusNet with the Original Proposal.
APA understands that Singapore Power was supportive of APA and AusNet engaging in discussions to determine whether a transaction could be agreed. APA has also discussed the Original Proposal directly with State Grid. 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. Superior Proposal APA considers its Superior Proposal is more attractive than the Brookfield Scheme for the following reasons:
• Higher price: Represents an offer price for AusNet of $2.60 per share (“Offer Price”);
• Retains ASX Listing: Retains the opportunity for ASX listed investors to invest in AusNet via APA securities, and participate in the benefits of the combined business;
• Synergy benefits: AusNet shareholders who accept APA securities can participate in the combined synergies to be obtained through the combination with APA, that are not currently available to AusNet shareholders;
• CGT rollover relief: AusNet shareholders will be able to obtain CGT rollover relief for that component of the Offer Price that is represented by Australian Pipeline Trust securities;
• No FIRB conditionality: APA’s proposal is not subject to a FIRB approval and, in contrast to the Brookfield Scheme, allows key electricity transmission infrastructure to remain in an Australian public listed vehicle.
By comparison, when taken together with the current ownership structure of TransGrid and the announced Spark Infrastructure transaction, the Brookfield Scheme would result in all electricity transmission infrastructure in NSW and Victoria being foreign controlled and held in private unlisted vehicles.
It would also result in 100% of Victorian electricity distribution and gas distribution assets being foreign controlled; 1 Based on APA’s security price as at close on 20 September 2021 of $8.88. Page 2
• Faster: The Superior Proposal is subject to a four-week confirmatory due diligence period, which is far shorter than the exclusivity period granted for the Brookfield Scheme. Compelling Strategic Rationale APA considers that the strategic rationale for combining APA and AusNet is compelling:
• Brings together two established and complementary Australian energy infrastructure businesses to create Australia’s largest energy transmission and distribution infrastructure utility, with total assets of $29 billion.
• Creates a flagship Australian company with the scale and capability to accelerate the $20 billion growth in electricity transmission infrastructure needed to support the decarbonisation of Australia’s economy.
• The combined entity would be able to access cost synergies and revenue growth opportunities not currently available to AusNet shareholders, by integrating operations, and by leveraging the world-class operational and development capabilities of the two businesses to expand AusNet’s infrastructure interests beyond Victoria.
• The combination would also release certain existing AusNet constitutional constraints which potentially limit the growth of its business by restricting AusNet’s ability to raise capital.
• The combination would provide customers and the community with a range of safe, clean and reliable energy solutions across electricity, gas, renewables, storage and other emerging technologies and would offer employees career opportunities in a larger, more diverse organisation.
• The combined entity would have substantially greater liquidity and free float, ranking in the top 40 ASX companies by market capitalisation. APA Managing Director and CEO, Rob Wheals, said: “Unlike many OECD countries, Australia lacks a locally owned and controlled energy utility with capabilities across critical energy infrastructure and with the size and strength to partner with government and the community to deliver the energy transition.”
“The combination of APA and AusNet is a unique opportunity to deliver that vision and retain a proudly Australian controlled combined group listed on the ASX.”
Details of the Superior Proposal In addition to the strategic rationale, the Superior Proposal is expected to deliver strong returns for APA over the long term.
Subject to APA’s confirmatory due diligence, the Superior Proposal is expected to exceed our return hurdles, be free cash flow per security accretive over the long-term and is expected to be free cash flow per security accretive in the first financial year post acquisition2.
APA remains committed to its minimum target credit rating of Baa2 (Moody’s) / BBB (S&P). Under the Superior Proposal, in aggregate AusNet shareholders would receive $1.820 cash and 0.0878 stapled securities in the Australian Pipeline Trust and APT Investment Trust (“securities”) for each AusNet share held, with a mix and match facility enabling shareholders to elect more cash or more securities, subject to aggregate caps in each. The Superior Proposal represents compelling value for AusNet shareholders. Based on APA’s closing price on 20 September 2021 of $8.88 per security, the Offer Price is equivalent to $2.60 per AusNet share and represents a:
• 31% premium to the undisturbed closing price of AusNet shares of $1.98 on 17 September 2021;
• 33% premium to the undisturbed 30-trading day VWAP of AusNet shares of $1.95 as at 17 September 2021;
• 41% premium to the undisturbed 90-trading day VWAP of AusNet shares of $1.85 as at 17 September 2021;
• An EV / RCAB multiple of 1.57x. AusNet shareholders will have the flexibility to elect to receive cash or securities consideration or a mixture of both. Should they choose securities consideration, AusNet shareholders, together with APA securityholders, will share in the future growth and value-creation opportunities of the combined group.
APA expects that AusNet shareholders will be able to obtain CGT rollover relief for that proportion of the Offer Price that reflects an exchange of securities into units of Australian Pipeline Trust.
2 Free cash flow per security accretive based on market available information for the AusNet’s regulated assets, 45% of regulatory capital expenditure deemed as stayin-business capex, approximate CPI escalation on FY21 non-regulated asset’s free cash flow, historical net working capital, tax payable based on PPE tax step up uplift, proposed funding and pricing structure and 100% ownership Page 3 Subject to agreement of terms with AusNet, APA expects to finance the cash consideration under the Superior Proposal with a combination of existing cash and debt facilities on hand, new bridging facilities and an equity raising.
The equity raising is expected to be approximately $1.5 billion and anticipated to be offered to eligible existing securityholders on a functionally pro-rata basis at the time of launch3.
The equity raising component is underwritten. The Superior Proposal is conditional on, among other things, confirmation by Tuesday 28 September 2021 from AusNet of granting due diligence access, completion of a targeted due diligence review and entry into a satisfactory scheme implementation deed.
Completion of any transaction will be subject to Australian Competition and Consumer Commission approval.
APA has offered to engage the Board of AusNet in relation to the Superior Proposal and the opportunity for AusNet shareholders to participate in the value created by combining APA and AusNet.
There is no certainty that the Superior Proposal, or any transaction, will be agreed or will proceed. APA is being advised by Aquasia, Goldman Sachs, J.P. Morgan, and Macquarie as financial advisers and King & Wood Mallesons as legal adviser.

i hold AST

DYOR

am still unhappy with APA after they took over EPX ( Ethane Pipeline ) which became a very nice little earner for me

but the scrip component probably makes this more attractive to me than Brookfield's all cash offer even if it is roughly one APA share for every 12 AST

but nice to see MQG will get a few bucks commission from this ( i hold MQG 'free-carried' )

would have really rather just keep holding AST but i guess i will be part of a tiny minority

 

[Smurf1976]

• No FIRB conditionality: APA’s proposal is not subject to a FIRB approval and, in contrast to the Brookfield Scheme, allows key electricity transmission infrastructure to remain in an Australian public listed vehicle.

I wouldn't underestimate the potential influence of government on this one.

The nature of the energy industry is such that government is never too far away and that is especially so in Australia given the past decade's politics.

I'm not making political comment as such there, just noting that the nature of the industry is such that government may well exert influence over ownership in a situation where it wouldn't if the business was involved in pretty much any other industry.

 

[divs4ever]

i would rather keep the shares , but i am not often on the winning side of take-over fights ( unless buying the target to get extra shares in the predator , AHE=> APE , TTS=>TAH as examples )

the APA deal suits me better of the two uninspiring offers

but government regulation ( currently and in the future ) probably softened the resolve of the board as much as the rewards of selling

 

[divs4ever]

Foreign Investment Review Board approval received in relation to proposed Scheme AusNet has been informed by Brookfield Asset Management Inc. that Australian Energy Holdings 4 Pty Ltd (Bidder) has received written confirmation from the Foreign Investment Review Board (FIRB) that the Commonwealth Government has no objection to the proposed acquisition of AusNet by Bidder via the proposed scheme of arrangement (Scheme). The FIRB condition contained in the Scheme Implementation Deed dated 31 October 2021 (released to ASX on 1 November 2021) has therefore been satisfied. The implementation of the Scheme remains subject to a number of other conditions, including approval of AusNet shareholders at the Scheme Meeting and Court approval, as outlined in the Scheme Implementation Deed. Naomi Kelly Company Secretary

DYOR

i hold AST

 

[divs4ever]

Supreme Court Approves Scheme
AusNet Services Ltd (AusNet) is pleased to announce that the Supreme Court of New South
Wales (the Court) has today made orders approving the scheme of arrangement under
which Australian Energy Holdings No 4 Pty Ltd (Bidder) (a company controlled by Brookfield
Asset Management, Inc.) will acquire all of the shares in AusNet (Scheme).
Lodgement of Court Orders
AusNet expects to lodge an office copy of the Court orders with the Australian Securities and
Investments Commission in accordance with section 411(10) of the Corporations Act 2001
(Cth) on Friday, 4 February 2022, at which time the Scheme will become legally effective
(Effective Date). If this occurs, AusNet will apply for its shares to be suspended from trading
on the Australian Securities Exchange with effect from the close of trade on the Effective
Date.
Implementation Timetable
If the Scheme becomes effective, AusNet shareholders who hold shares at the Scheme
Record Date, expected to be 7.00pm (Melbourne time) on Wednesday, 9 February 2022, will
receive cash consideration of $2.6025 per AusNet share (Scheme Consideration) (which,
when added to AusNet's interim unfranked dividend for the half year ended 30 September
2021 of $0.0475 per AusNet share paid on 16 December 2021 (Interim Dividend), equates
to a total cash amount of $2.65 per AusNet share).1
The Scheme Consideration will be paid on the implementation date, which is expected to be
Wednesday, 16 February 2022.
Shareholder Information Line
AusNet shareholders requiring further information in relation to the Scheme may contact the
AusNet Shareholder Information Line on 1300 540 303 (within Australia) or +61 2 9066 4083
(outside Australia), Monday to Friday (excluding public holidays) between 9.00am and
5.00pm (Melbourne time).
AusNet is being advised by Adara Partners and Citigroup as financial advisers, and by Allens
as legal adviser.


DYOR

i hold AST

another profit crystallized .. ( sigh )

 

[System]

On February 17th, 2022, AusNet Services Limited (AST) was removed from the ASX's Official List in accordance with Listing Rule 17.11, following implementation of the scheme of arrangement between AST and its shareholders in connection with the acquisition of all the issued capital in AST by Australian Energy Holdings No 4 Pty Ltd.