Infratil (NZX:IFT) declares strategic review of its stakes in Tilt Renewables

Summary

  • Infratil is planning to undertake a strategic review of its stake in Tilt Renewables, a wind farm company with a portfolio of operating assets in Australia and NZ with a significant development pipeline, after strong interest from potential buyers.
  • Infratil has appointed Goldman Sachs to undertake the strategic review and is expected to be completed by mid of 2021.
  • Mercury NZ Limited has conceded that the strategic review conducted by Infratil may result in a bid for all Tilt shares but stated there is currently no arrangement between Infratil and Mercury concerning the review.

Infratil Limited (NZX:IFT), utilities and infrastructure investor, has stated its intention to carry out a planned evaluation of its shareholding in Tilt Renewables Limited (NZX:TLT). The Company owns about two-thirds of Tilt, which is listed on both NZX and ASX.

Several inquiries have been obtained by Infratil related to its Tilt shareholding. Infratil believes it is wise to explore replacements to its Tilt shareholding, including the divestment of its position, considering the strong demand for high-quality clean energy platforms globally.

Source: Shutterstock

Tilt Renewables is a prominent renewables platform in Australia and New Zealand, with a range of high-quality operating assets, a considerable development channel and a professional team with established ability to deliver.

A material improvement in projected returns and shareholder equity compared to the present optimistic outlook would be needed for taking any decision to implement a specific proposal by the Company.

The strategic review is planned to be completed within 6 months.

Infratil strictly adheres to deploying clean energy resources internationally and has set up scaled platforms in Australia, New Zealand, US, and Europe, as per Marko Bogoievski, CEO of Infratil. 

In other geographies, the Company continues to evaluate prospects while assessing the pace of growth in its developed markets, he added. Tilt and its management team continue to be strongly positive, but the vast interest in Tilt has shifted the balance in support of launching the strategic review.

Infratil has appointed Goldman Sachs to undertake the strategic review and is expected to be completed by mid of 2021.

No arrangement between Mercury and Infratil over the review

Mercury NZ Limited that owns almost 20% of TLT noted the announcement made by Infratil on a strategic review of its shareholding in Tilt Renewables Limited.

Source: Shutterstock

The energy company stated that though it is informed that a review by Infratil could lead to an offer for all shares, no such arrangement was in place between Infratil and Mercury.

Mercury is quite content with the success of its investment in Tilt to date and has not taken a stance on the prospects of that investment. Mercury's directors will carefully track the developments.

On 7 December, at the time of writing, Infratil shares were trading at NZ$5.95, up by 2.59%. Also, at the same time, Tilt Renewables shares were trading at NZ$4.4, up by 12.24%.

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