Atlas Arteria shares jump 12.5% following IFM takeover bid
Make us a preferred source
Make us a preferred source on Google
More news: Atlas Arteria shares surged 12.47% by 10.39am (AEST) after resuming trading following a pause as it updated the market on a takeover offer from an IFM Investors subsidiary.
The offer is worth about $7 billion.
The toll road operator said the offer was unsolicited. It is forming an independent board to consider the offer alongside advisers.
Atlas Arteria advises shareholders take no action as it considers IFM offer
More news: Atlas Arteria has acknowledged the off-market takeover bid from IFM and advised shareholders to “take no action” as a board committee is established to take a closer look at the deal.
A statement from the toll road operator notes the $4.75 cash per security offer “represents a premium of only 10% based on last closing security price”.
“The offer is subject to a number of conditions including conditions which involve third party consents, approvals or waivers. The conditions of the offer may or may not be able to be satisfied. Unless the conditions of the offer are satisfied or waived the takeover offer will not proceed,” Atlas Arteria’s statement to the ASX said.
Atlas Arteria’s boards will establish an independent board committee to consider the offer alongside its advisers and will “update shareholders in due course”.
UBS and Flagstaff have been appointed as financial advisers, with Magellans appointed as legal adviser. There was no communication from IFM to Atlas Arteria before the bidder’s statement was received, the ASX release said.
Atlas Arteria in trading pause following IFM Investors’ $7b takeover bid
The news: Toll road operator Atlas Arteria has entered into a trading pause pending a further announcement after IFM Investors made a $4.75 a share offer, worth about $6.9 billion, to buy the remaining stake it doesn’t yet own.
The numbers: IFM is currently a 35% owner in Atlas via its subsidiary Diamond Infraco 1. Its offer was revealed to the ASX on Monday morning.
The deal, first revealed by the Financial Review, is a “best and final”.
It is priced at an 11% premium to the one-month volume weighted average price. It will be increased to $5.10, representing a 19% premium, if acceptances reach 45% including IFM’s existing stake. At the higher price, the deal would be worth $7.4 billion.
There is no minimum acceptance condition.
What they said: The offer from IFM encourages acceptance due to the premium being offered, the consideration being 100% cash and the underperformance of Atlas Arteria “in terms of total shareholder return relative to global listed infrastructure and other market indices”.
“If you do not accept the offer, there is a risk that this underperformance will continue,” the IFM offer documents warn, noting Atlas Ateria has indicated it is actively looking at M&A opportunities with funding flexibility, “a material change from [its] previous position, which explicitly ruled out equity funding in relation to new opportunities”.
