The publicly listed infrastructure firm from Hong Kong, CK Infrastructure (CKI), has placed a bid of AU$12.98bn (US$9.85mn) for the largest pipeline company in Australia, APA Group.
The takeover bid includes a 33% premium, Reuters reported, offered by the CKI-led consortium, featuring CK Asset Holdings and Power Assets Holdings.
“It’s a decent premium. What it basically shows is there is a disconnect between how the private market wants to value these assets and how the stock market values them,” commented Jason Teh, Chief Investment Officer at Vertium Asset Management, Reuters noted.
The consortium offered the firm AUS$11 (US$8.35) per share. At its last close, APA’s shares were worth AU$8.27 (US$6.28), with it’s record high recorded last year at AUS$9.90 (US$7.51).
“Based on the indicative price of A$11.00 cash per stapled security, the APA Board considers that it is in the best interests of APA’s securityholders to engage further with the consortium,” stated APA.
CKI has already entered gas and power market in Australia, owning several units, and purchasing DUET Group last year for AU$7.4bn (US$5.62bn).
APA has agreed to open its book for the consortium to review whilst its asses the loan and awaits any more potential offers.