Inter Pipeline Walks Away from Pembina Deal in Favor of Brookfield Bid
(Reuters) — Canadian pipeline operator Inter Pipeline on Monday decided against recommending a C$8.5 billion ($6.77 billion) deal with rival Pembina Pipeline Corp to shareholders and instead chose to pursue a higher bid from Brookfield Infrastructure Partners.
Following Inter's U-turn, Pembina terminated the deal, choosing to walk away with a C$350 million breakup fee, while Brookfield said it expected Inter to recommend its offer to shareholders.
The moves come after five-month-long bitter bidding war between Brookfield, Inter and Pembina, which has played out amid a rebound in oil prices and energy stocks after last year's historic pandemic-led downturn.
Infrastructure buyout firm Brookfield first made an unsolicited bid of about C$7.8 billion for Inter in February and eventually raised it to about C$8.58 billion in cash or stock this month, winning support from leading proxy advisors.
Under the infrastructure fund's revised offer, Inter shareholders can elect to receive either C$20 per share in cash or 0.25 of a share of Brookfield Infrastructure.
Inter had opposed previous Brookfield's bids, electing to go with Pembina at the start of June after a four-months long strategic review.
However, Brookfield's latest offer looked too good to refuse, with proxy advisors Institutional Shareholder Services and Glass Lewis highlighting a higher price and better chances of regulatory approval.
Inter said on Monday it will pay Pembina a termination fee of C$350 million and will make a formal recommendation on the Brookfield offer in "due course".
The company said its board is "open to engaging with Brookfield in an effort to reach a mutually agreeable transaction."
"While we are disappointed with this outcome, we will continue to seek opportunities for growth through focused acquisitions," Pembina Chief Executive Officer Mick Dilger said.
Related News
Related News
- Keystone Oil Pipeline Resumes Operations After Temporary Shutdown
- Biden Administration Buys Oil for Emergency Reserve Above Target Price
- Freeport LNG Plant Runs Near Zero Consumption for Fifth Day
- Enbridge to Invest $500 Million in Pipeline Assets, Including Expansion of 850-Mile Gray Oak Pipeline
- Williams Delays Louisiana Pipeline Project Amid Dispute with Competitor Energy Transfer
- Evacuation Technologies to Reduce Methane Releases During Pigging
- Editor’s Notebook: Nord Stream’s $20 Billion Question
- Enbridge Receives Approval to Begin Service on Louisiana Venice Gas Pipeline Project
- Russian LNG Unfazed By U.S. Sanctions
- Biden Administration Buys Oil for Emergency Reserve Above Target Price
Comments