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July 16, 2021updated 27 Jul 2021 12:28pm

Brookfield hikes bid for Inter Pipeline to $6.85bn

The revised takeover offer shifts the focus to rival suitor Pembina Pipeline, which made an all-stock offer of $6.75bn.

By Archana Rani

Brookfield Infrastructure Partners has increased its cash-and-stock offer for Canada’s Inter Pipeline (IPL) to $6.85bn (C$8.58bn), topping Pembina Pipeline’s $6.75bn (C$8.5bn) offer.

The latest offer valued Inter at C$21.23 per share, a premium of C$1.53 or 8% compared with Pembina Pipeline’s offer of C$19.70 per share as of 14 July 2021.

The company raised the cash portion of its bid by 2.6% to C$20 for each Inter Pipeline share compared with zero cash consideration in Pembina’s offer.

Shareholders electing for the stock would get 0.25 of a Brookfield Infrastructure share, subject to proration.

Previously, IPL recommended that shareholders vote for the offer made by Pembina.

Commenting on the latest offer, Inter Pipeline said: “Inter Pipeline advises shareholders that no formal revised offer has been made by Brookfield, and as such, there is no need for shareholders to take any action at this time.

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“A formal recommendation by the board will be made to shareholders in due course.”

Brookfield Infrastructure had earlier offered approximately C$19.50 in all-cash per Inter share, or 0.225 of Brookfield’s Class A share.

Brookfield Infrastructure already owns a stake of 19.65% in Inter Pipeline.

The revised offer comes after the Alberta Securities Commission ruling that Inter did not indulge in any ‘improper defensive tactics’ to resist hostile takeover bids made by Brookfield.

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