Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

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<p>Just under two weeks after <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02395702-2A1310049?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">rejecting</a> two take-private proposals from KKR and Ontario Teachers’ Pension Plan Board (OTPPB), Aussie poles and wires company <a href="https://www.smartkarma.com/entities/spark-infrastructure-group" target="_blank" data-smartkarma-citation="entities:595:1" rel="noopener">Spark Infrastructure (SKI AU)</a> announced <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02399952-2A1312120?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">support</a> for the Consortium's improved proposal of $2.95/share. The Offer was up from the initial Offer of $2.70/share. Due diligence was subsequently afforded.</p>
<p>On the 10 August, Spark <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02405270-2A1314740?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">received</a> a request from the Consortium to engage with Public Sector Pension Investment Board (PSP), Canada's largest pension investment managers.  OTTPB and KKR said their interest in Spark is not contingent on PSP receiving all internal and external approvals to participate in the Consortium's revised Offer.</p>
<p>A firm Offer has now been <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02409984-2A1317108?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">tabled</a> and a SID entered into with KKR, OTTPB, and PSP. The terms remain the same. Spark's board unanimously recommends the Offer. The Scheme Meeting is expected to be held by the end of 2021.</p>
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<p>As discussed in <em><a href="https://skr.ma/LdjsX" target="_blank" rel="noopener">Spark Infrastructure (SKI AU): KKR &amp; OTPPB Pay Up</a></em>, $2.95/share appeared a full price. This looks done to me.</p>
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<p>More below the fold.</p>
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Just under two weeks after rejecting two take-private proposals from KKR and Ontario Teachers’ Pension Plan Board (OTPPB), Aussie poles and wires company Spark Infrastructure (SKI AU) announced support for the Consortium's improved proposal of $2.95/share. The Offer was up from the initial Offer of $2.70/share. Due diligence was subsequently afforded.
On the 10 August, Spark received a request from the Consortium to engage with Public Sector Pension Investment Board (PSP), Canada's largest pension investment managers.  OTTPB and KKR said their interest in Spark is not contingent on PSP receiving all internal and external approvals to participate in the Consortium's revised Offer.
A firm Offer has now been tabled and a SID entered into with KKR, OTTPB, and PSP. The terms remain the same. Spark's board unanimously recommends the Offer. The Scheme Meeting is expected to be held by the end of 2021.


As discussed in Spark Infrastructure (SKI AU): KKR &amp; OTPPB Pay Up, $2.95/share appeared a full price. This looks done to me.


More below the fold.


Spark Infrastructure (SKI AU): KKR/OTPPB/PSP's Firm Offer

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<p>After <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02395702-2A1310049?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">rejecting</a> two take-private proposals from PR outfit firm KKR and Ontario Teachers’ Pension Plan Board (OTPPB), Aussie poles and wires company <a href="https://www.smartkarma.com/entities/spark-infrastructure-group" target="_blank" data-smartkarma-citation="entities:595:1" rel="noopener">Spark Infrastructure (SKI AU)</a> has ostensibly supported the Consortium's improved tilt of $2.95/share.</p>
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<p>The Consortium (KKR/OTPPB)'s latest proposal, up from the initial Offer of $2.70/share, was considered by Spark's board to be in the interest of its shareholders to engage further. As such, Spark has provided the Consortium with due diligence on a non-exclusive basis.</p>
<p>This Offer remains pre-conditional, and is subject to satisfactory DD, together with board approval from both KKR and OTPPB.</p>
<p>A firm Offer, should one unfold, would be subject to FIRB approval, and the approval from Spark's shareholders at a Scheme Meeting.</p>
<p>Yet this looks like a full (er) Offer than the one rejected on the 15 July.</p>
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<div>
<p>More below the fold.</p>
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After rejecting two take-private proposals from PR outfit firm KKR and Ontario Teachers’ Pension Plan Board (OTPPB), Aussie poles and wires company Spark Infrastructure (SKI AU) has ostensibly supported the Consortium's improved tilt of $2.95/share.


The Consortium (KKR/OTPPB)'s latest proposal, up from the initial Offer of $2.70/share, was considered by Spark's board to be in the interest of its shareholders to engage further. As such, Spark has provided the Consortium with due diligence on a non-exclusive basis.
This Offer remains pre-conditional, and is subject to satisfactory DD, together with board approval from both KKR and OTPPB.
A firm Offer, should one unfold, would be subject to FIRB approval, and the approval from Spark's shareholders at a Scheme Meeting.
Yet this looks like a full (er) Offer than the one rejected on the 15 July.


More below the fold.


Spark Infrastructure (SKI AU): KKR & OTPPB Pay Up

<p>Aussie poles and wires company <a href="https://www.smartkarma.com/entities/spark-infrastructure-group" target="_blank" data-smartkarma-citation="entities:595:1" rel="noopener">Spark Infrastructure (SKI AU)</a> has <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02395702-2A1310049?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">rejected</a> two take-private proposals from PR outfit firm KKR and Ontario Teachers’ Pension Plan Board (OTPPB).</p>
<p>KKR/OTPPB's first proposal was A$2.70/share, by way of a Scheme, which would be reduced by the 1H21 dividend of A$0.0625/share. KKR/OTPPB subsequently reloaded with A$2.80/share - paltry 12.9% to last close - which was also summarily rejected on the grounds it undervalued Spark.</p>
<p>Spark added:</p>
<blockquote>
<p>Whilst not granting access to due diligence, in order to be constructive, the board of Spark Infrastructure informed the consortium that it was prepared to provide limited information on Spark Infrastructure’s business and its prospects.</p>
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<p>More below the fold.</p>

Aussie poles and wires company Spark Infrastructure (SKI AU) has rejected two take-private proposals from PR outfit firm KKR and Ontario Teachers’ Pension Plan Board (OTPPB).
KKR/OTPPB's first proposal was A$2.70/share, by way of a Scheme, which would be reduced by the 1H21 dividend of A$0.0625/share. KKR/OTPPB subsequently reloaded with A$2.80/share - paltry 12.9% to last close - which was also summarily rejected on the grounds it undervalued Spark.
Spark added:

Whilst not granting access to due diligence, in order to be constructive, the board of Spark Infrastructure informed the consortium that it was prepared to provide limited information on Spark Infrastructure’s business and its prospects.

More below the fold.

Spark Infra (SKI AU): KKR & OTPPB's Tilts Falls Short

<p><strong><a href="https://www.smartkarma.com/entities/sydney-airport" target="_blank" data-smartkarma-citation="entities:19063:1" rel="noopener">Sydney Airport (SYD AU)</a></strong> has <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02391761-2A1307944?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">announced</a> a consortium comprising IFM Investors, QSuper, and fund manager Global Infrastructure Management has made an indicative, non-binding Offer by way of a Scheme at $8.25/share,  a 42% premium to last close.  </p>
<p><strong>SYD</strong> has commenced an assessment of the proposal but mentions the Offer price is below the Covid-cliff, and that the pandemic effect on operations is expected to be short-term.  </p>
<p>Separately, the Offer is conditional on regulatory approvals such as FIRB and ACCC. As a critical aviation asset, it's not just the opportunistic price that could torpedo this deal.</p>
<p>More below the fold.</p>

Sydney Airport (SYD AU) has announced a consortium comprising IFM Investors, QSuper, and fund manager Global Infrastructure Management has made an indicative, non-binding Offer by way of a Scheme at $8.25/share,  a 42% premium to last close.  
SYD has commenced an assessment of the proposal but mentions the Offer price is below the Covid-cliff, and that the pandemic effect on operations is expected to be short-term.  
Separately, the Offer is conditional on regulatory approvals such as FIRB and ACCC. As a critical aviation asset, it's not just the opportunistic price that could torpedo this deal.
More below the fold.

Sydney Airports (SYD AU): Opportunistic Tilt Amid Cloudy Future

<p>Back on the 14 March, <a href="https://www.smartkarma.com/entities/tilt-renewables-ltd" target="_blank" data-smartkarma-citation="entities:24371:1" rel="noopener">Tilt Renewables Ltd (TLT NZ)</a> <a href="http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/TLT/369079/342312.pdf" target="_blank" rel="noopener">announced</a> a binding agreement from <a href="https://www.smartkarma.com/entities/mighty-river-power" target="_blank" data-smartkarma-citation="entities:9933:1" rel="noopener">Mercury NZ Ltd (MCY NZ)</a> and PowAR by way of a Scheme at NZ$7.80/share, or a 99% premium to the undisturbed price.  PowAR is a partnership between <a href="https://www.smartkarma.com/entities/agl-energy-ltd" target="_blank" data-smartkarma-citation="entities:554:1" rel="noopener">AGL Energy Ltd (AGL AU)</a>, QIC, and Australia’s sovereign wealth fund.</p>
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<p>Should the Scheme be successful, Tilt will sell its Australian assets to PowAR, and Mercury NZ acquires the New Zealand assets, including all future development operations. The Offer has the backing of Infratil and Mercury, holding 65.5% and 19.92% respectively.</p>
<p>After entering a <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02363756_NPS-3A565326?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">trading halt</a> early last Friday, Tilt <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02364436-3A565443?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">announced</a> it has amended the terms of the Scheme Implementation Agreement (SIA), such that PowAR/Mercury will now pay NZ$8.10/share</p>
<p>In addition to the increased price, the SIA has been amended to remove provisions allowing Tilt to evaluate any “<em>competing proposal giving greater certainty to all parties and Tilt shareholders that the transaction will complete by August</em>."</p>
<p>AGL also <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02364591-2A1293172?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">said</a> Tilt had received a competing proposal from a third party. Reportedly Canadian pension fund CDPQ made a bid of NZ$8/share Offer, and that Tilt tapped the consortium to match or beat that proposal.</p>
<p>The prospect of a last-minute gate-crasher now appears diminished. More below the fold.</p>
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Back on the 14 March, Tilt Renewables Ltd (TLT NZ) announced a binding agreement from Mercury NZ Ltd (MCY NZ) and PowAR by way of a Scheme at NZ$7.80/share, or a 99% premium to the undisturbed price.  PowAR is a partnership between AGL Energy Ltd (AGL AU), QIC, and Australia’s sovereign wealth fund.

Should the Scheme be successful, Tilt will sell its Australian assets to PowAR, and Mercury NZ acquires the New Zealand assets, including all future development operations. The Offer has the backing of Infratil and Mercury, holding 65.5% and 19.92% respectively.
After entering a trading halt early last Friday, Tilt announced it has amended the terms of the Scheme Implementation Agreement (SIA), such that PowAR/Mercury will now pay NZ$8.10/share
In addition to the increased price, the SIA has been amended to remove provisions allowing Tilt to evaluate any “competing proposal giving greater certainty to all parties and Tilt shareholders that the transaction will complete by August."
AGL also said Tilt had received a competing proposal from a third party. Reportedly Canadian pension fund CDPQ made a bid of NZ$8/share Offer, and that Tilt tapped the consortium to match or beat that proposal.
The prospect of a last-minute gate-crasher now appears diminished. More below the fold.


Tilt Renewables: Mercury/PowAR's Bump Heads Off Third-Party Bidders

Australia

AGL Energy Limited sells and distributes gas and electricity. The Company retails and wholesales energy and fuel products to customers throughout Australia.

Volt Power Group Limited operates as an energy company. The Company offers a technology that harvests waste heat from power generation and other industrial process and turns into low emission electricity, as well as acquires and develops power generation assets. Volt Power Group serves customers in Australia.

Petratherm Limited explores for sources of geothermal energy in the South Australian region such as hot rocks.  These sources can be used for the development of renewable energy power generation.

Carnegie Clean Energy Limited operates as a renewable energy company. The Company generates energy from wave, solar, and wind. Carnegie Clean Energy offers its services worldwide.

ReNu Energy Limited generates electricity through renewable energy projects. The Company operates biogas energy generation project, as well as offers solar photovoltaics, battery storage, and hybrid energy solutions.

K2 Energy Limited is an oil and gas exploration Company.  The Company explores for oil and gas in the Okfuskee County in Oklahoma, in the United States of America.

Energy World Corporation Ltd. generates electricity.  The Company operates gas-fired power plants in Sengkang, South Sulawesi, Indonesia; and Alice Springs, Northern Territory, Australia.  Energy World also produces natural gas and liquefied natural gas in Australia.

New Energy Solar Limited operates as an renewable energy development company. The Company acquires and develops solar and renewable energy sectors. New Energy Solar also renders in wind, geothermal, hydro-electricity, and hybrid solutions. New Energy Solar serves customers in Australia and the United States.

Black Rock Mining Ltd focuses on the exploration and development of its Mahenge graphite project. The Company engages in the drilling of diamond core and reverse circulation drillholes. Green Rock Energy operates in Tanzania.

High Peak Royalties Ltd is a Hot Fractured Rock geothermal exploration company. The Company is focused on the exploration and production of geothermal resources for power generation.

PetroVietnam Gas JSC transports, stores, and markets petroleum gas.  The Companies products include liquefied petroleum gas, dry gas, compressed natural gas, and liquefied natural gas.  PetroVietnam's services include gas gathering, gas importation, gas transportation and distribution, gas engine development and gas operation and maintenance.

Petronas Gas Berhad processes and separates natural gas into its components from the gas field offshore Terengganu. The Company stores, transports, and distributes these components as well as trades utilities to petrochemical plants.

China Resources Gas Group Ltd distributes natural gas and petroleum gas in the cities of Chengdu, Fuyang, Huaibei, Linhai, Suzhou and Wuxi in the PRC. The Company also operates compressed natural gas filling stations in Chengdu, Nanjing and Wuxi. The group also is involved in bottled liquefied petroleum gas distribution in cities of Fuyang, Suzhou and Wuxi.

ENN Energy Holdings Ltd. distributes natural gas in China.  The Company, through its subsidiaries, invests in, operates, and manages gas pipelines, and sells and distributes piped and bottled gas in China.

Southwest Gas Corporation purchases, transports, and distributes natural gas to residential, commercial, and industrial customers in portions of Arizona, Nevada, and California.  The Company also provides construction services to utility companies, including trenching and installation, replacement, and maintenance services for energy distribution systems.

TOKYO GAS CO., LTD. produces and supplies liquefied natural gas to Tokyo and the surrounding areas.  The Company maintains and manages gas supply equipment and sells air conditioning appliances.  Tokyo Gas operates power generation business as well.

National Fuel Gas Company is an integrated natural gas company with operations in all segments of the natural gas industry, including utility, pipeline and storage, exploration and production, and marketing operations.  The Company operates across the United States.

China Gas Holdings Ltd. invests in, operates and manages natural gas distribution pipelines.  The Company distributes and sells natural gas to residential, commercial and industrial users, and bottles and sells compressed natural gas.  China Gas also constructs and operates gas stations.

Enn Natural Gas Co.,Ltd. offers natural gas engineering services. The Company provides natural gas engineering investment, gas station construction, and energy equipment distribution services. Enn Natural Gas also operates coal materials, chemicals,  and biopharmaceutical products trading businesses.

UGI Corporation distributes and markets energy products and services.  The Company is a domestic and international distributor of propane.  UGI also distributes and markets natural gas and electricity, and sells related products and services in the Middle Atlantic region of the United States.

APA Group is a natural gas infrastructure company. The Company owns and or operates gas transmission and distribution assets whose pipelines span every state and territory in mainland Australia. APA Group also holds minority interests in energy infrastructure enterprises.

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APA Group (APA AU)

Spark Infrastructure (SKI AU): KKR/OTPPB/PSP's Firm Offer

Trading tight at a 2.0%/6.6% gross/annualised spread. Franking credits may add up to an additional A$0.05/share to those shareholders who can take...

David Blennerhassett

Spark Infrastructure (SKI AU): KKR & OTPPB Pay Up

Assuming ~5 months to complete, this is trading at a gross/annualised return of 5%/12.6%. I don't expect any shareholders to oppose, and FIRB...

David Blennerhassett

Spark Infra (SKI AU): KKR & OTPPB's Tilts Falls Short

This appears a full offer for Spark, especially noting greater regulatory oversight on expected returns. KKR/OTTB have deep pockets. But I'm...

David Blennerhassett

Sydney Airports (SYD AU): Opportunistic Tilt Amid Cloudy Future

A full Offer probably needs to be tabled at $9+, ~9% up from the current proposal, and an additional $2bn outlay from the Consortium. I think DD...

David Blennerhassett

Tilt Renewables: Mercury/PowAR's Bump Heads Off Third-Party Bidders

Trading tight at a 1.8%/6.0% gross/annualised spread. You could buy here for the spread, and the outside chance a superior Offer does indeed emerge.

David Blennerhassett

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