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Greenspark Power launches $431m bid for Energy Developments
By resourceINTEL · November 30, 2009 · 7:48 am · Leave a Comment
ENERGY Developments has received a $431 million takeover bid from Greenspark Power Holdings, which is jointly owned by entities advised by private equity group Pacific Equity Partners, but its board indicated today that it may urge shareholders to reject the bid.
A clean energy group that generates power from landfills and coal mine methane, Energy Developments has now received four separate offers for either the whole company or some of its assets in the past three months.
Despite the possible objection of Energy Development’s directors, Greenspark’s bid of $2.75 per Energy Developments share appears more likely to succeed, with the company claiming its offer has already received the support of 42.4 per cent of Energy Developments’ shareholders. This includes a pre-bid acceptance from New Zealand’s Infratil over a 19.9 per cent holding in the company.
Greenspark’s bid has a 50.1 per cent minimum acceptance condition.
Energy Developments, however, said the bid “is only 10 cents per share” above Pacific Equity Partners’ earlier proposal to acquire the company for $2.65 per share, which it rejected as too low.
“The latest offer is now under close consideration and the company will provide shareholders with further advice in due course,” Energy Developments said in a statement.
An independent expert hired by Energy Developments earlier this month concluded that Pacific Equity Partners offer of $2.65 per share was “neither fair nor reasonable” and valued the company between $3.17 and $4.09 per share.
Energy Developments last month also ended talks with an international infrastructure fund manager, which had offered to buy the group’s landfill gas power generation interests in France and the UK, after terms couldn’t be agreed.
In August, it terminated discussions with private equity firm Archer Capital, which had made an indicative offer of $2.80 a share.
To justify rejecting Archer’s offer, Energy Developments cited the potential financial upside from Australia’s mandatory renewable energy target and the “unresolved conditionality” of Archer’s bid.
Greenspark said its offer of $2.75 per Energy Developments share represents a 90 per cent premium to their closing price on June 5, when the company received the offer from Archer Capital.
Infratil, which owns about 32 per cent of Energy Developments, said Greenspark’s bid represents “fair value”…read more at The Australian
