Inter Pipeline (TSX:IPL) Scraps Brookfield’s Hostile Takeover Bid

2 min read | March 10, 2021 08:21 AM AEDT | By Shreya Biswas

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Inter Pipeline (TSX:IPL) Scraps Brookfield’s Hostile Takeover Bid

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Summary

Inter Pipeline Ltd (TSX:IPL) has unanimously rejected Brookfield Infrastructure Partners’ (TSX:BIP.UN) C$ 13.5-billion hostile takeover offer launched earlier in February.

Brookfield Infrastructure had reached out to Inter Pipeline’s shareholders with an offer to take it private on February 10.

Rejecting the offer after about a month of evaluation, Inter Pipeline urged its investors to not tender their shares.

Canadian energy distributing company Inter Pipeline Ltd (TSX:IPL) has unanimously rejected Brookfield Infrastructure Partners’ (TSX:BIP.UN) C$ 13.5-billion hostile takeover offer launched earlier in February.

Inter Pipeline announced in a statement on Tuesday, March 9, that it came to the decision following “careful consideration” and inputs financial and legal advisers, as well as a group of independent directors.

Its board of directors said that Brookfield’s hostile bid was not reflective of Inter Pipeline’s full and fair value.

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The Calgary-based enterprise, however, added that it is currently conducting a strategic evaluation of alternatives.

At the time of writing this, Inter Pipeline stocks were up about one per cent on Tuesday, while Brookfield Infrastructure shares spiked over two per cent (10.24AM EST).

Brookfield Infrastructure’s Hostile Takeover Bid For Inter Pipeline

Brookfield Infrastructure, which happens to be Inter Pipeline’s biggest shareholder, had reached out to the latter’s shareholders with an offer to take it private on February 10. Investors were given a choice to give up their shares in the company in exchange of C$ 16.5 apiece or 0.206 of a Brookfield Infrastructure class A share. The maximum cash available for the offer was set at C$ 4.9 billion.

While launching the hostile takeover bid, Brookfield said it had initially reached out to Inter Pipeline with a takeover offer “in the range of C$ 17-18.25” per share, but the discussions never bore fruit.

In response, Inter Pipeline had said that Brookfield never made any form of a formal offer and what it had received were “unsolicited, non-binding and conditional proposals”.

Rejecting the offer after about a month of evaluation, Inter Pipeline urged its investors to not tender their shares.

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