Brookfield Affiliate Makes Hostile $5.6 Billion Pipeline Bid
Bloomberg
Published Feb 11, 2021 00:53
Updated Feb 11, 2021 01:36
(Bloomberg) -- Brookfield Infrastructure (NYSE:BIPC) Partners LP made a hostile C$7.1 billion ($5.6 billion) takeover offer for Inter Pipeline (OTC:IPPLF) Ltd. after it said an earlier approach to the Canadian company was rebuffed.
The bidder, an affiliate of Brookfield Asset Management Inc., said Wednesday it will offer C$16.50 per share in cash or stock and has amassed a 19.6% economic stake in Inter through shares and derivatives, making it the Calgary-based company’s largest investor.
Brookfield said it first approached Inter Pipeline in September and subsequently made takeover proposals at a premium of as much as 50% to the company’s share price at the time. It said Inter “declined to engage constructively” on a deal and took an optimistic view of its future growth potential.
“Brookfield Infrastructure believes the company’s view fails to recognize the capital market realities facing energy-based infrastructure companies now and in the future,” the firm said in a statement.
A spokesperson for Inter Pipeline said in an email that the company couldn’t immediately comment on the offer.
Brookfield Infrastructure, based in Toronto, is one of the world’s largest owners of hard infrastructure assets, managing $91 billion including electrical utilities, pipelines, ports, toll roads and data infrastructure, according to its website. In 2016, Brookfield and a group of partners agreed to buy a 90% stake in a Brazilian natural gas distribution network owned by Petroleo Brasileiro SA for $5.2 billion.
Inter Pipeline has been the subject of takeover rumors for more than a year. The company operates a series of oil pipelines in Alberta and Saskatchewan as well as natural gas liquids processing plant. The company also operates terminals in Sweden and Denmark with 19 million barrels of storage.
(Updates with new information and context beginning in second paragraph)
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