Australia's APA wins board backing for $1.5 billion HDF bid
SYDNEY (Reuters) - Directors of Australia's Hastings Diversified Utilities Fund (HDF) HDF.AX on Tuesday recommended a A$1.4 billion ($1.46 billion) bid by rival gas distributor APA (APA.AX) after an alternative suitor bowed out.
APA had been fighting Pipeline Partners Australia for control of two key gas pipelines owned by HDF that serve Australia's main onshore gas hub, Moomba. Analysts say growth prospects are strong because of new coal-seam gas projects and huge liquefied natural gas export projects in Queensland state.
On Monday, Pipeline Partners bowed out of the race, declining to match APA's higher offer.
A subcommittee of HDF independent directors said it was dropping a recommendation of Pipeline Partner's lower bid and was now recommending APA's offer in the absence of a superior proposal.
Securities in HDF last traded up 1.2 percent at A$2.59 compared with the implied value of APA's cash and scrip bid of A$2.60. APA shares were up 1.1 percent at A$4.67.
Pipeline Partners, a consortium that includes Canadian fund manager Caisse de depot et placement du Quebec (CDPQ) and Utilities Trust of Australia, a fund managed by HDF's manager Hastings Funds Management, had offered A$2.43 per HDF security ($1 = 0.9569 Australian dollars)