By Sonali Paul and Shreya Mariam Job
MELBOURNE / BANGALORE (Reuters) – Philippine tycoon Ayala Corp has made a bid worth A $ 777 million ($ 535 million) to buy Infigen Energy, pouncing on Australian renewable energy companies as wind and solar power companies struggle against falling electricity prices.
UAC Energy Holdings, a joint venture of Ayala’s AC Energy and UPC Renewables Group based in Hong Kong, said it would offer A $ 0.80 per share in cash, 36% premium from the previous Infigen closure.
Infigen shares surged to a four-month high of A $ 0.81 after the offer was announced, reflecting the view of investors that the deal could continue.
“We think this takeover offer allows shareholders to crystallize present value with attractive premiums with recent share prices,” Royal Bank of Canada (RBC) analyst James Nevin said in a note.
Sydney-based Infigen did not immediately respond to requests for comment.
If successful, UAC will acquire seven 600 megawatt wind farms and pipeline projects that have recently been suspended by Infigen to save money amid falling wholesale electricity prices, COVID-19 restrictions, and challenges to integrating wind and solar farms into the Australian network the wobbly one.
“We have ready access to significant renewable energy capital and expertise that will position us well to support the Infigen pipeline project and focus on much-needed renewable energy investments and related work in Australia,” UAC Chair Anton Rohner said in a statement.
UAC is developing four other renewable energy projects in Australia.
Nevin of RBC said it would make sense for shareholders to accept the offer, given that Infigen had delayed its growth ambitions, which would likely limit the growth of its share price in the near future.
UAC has acquired a 12.8% stake in Infigen.
He has set no minimum acceptance requirements for bids, so there is no need for support from top shareholders of Infigen, the activist British investor TCI Fund Management, which owns 26% of Infigen, according to Refinitiv data.
TCI partners in London cannot immediately comment outside office hours.
Credit Suisse advises UAC.
($ 1 = 1.4514 Australian dollars)
(Reporting by Sonali Paul in Melbourne and Shreya Mariam’s work in Bengaluru; Editing by Stephen Coates and Anikaraman Muralikumar)
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