CANADA/AUSTRALIA - The Canada Pension Plan Investment Board is to buy Intoll Group for A$3.44bn ($3bn) after increasing its initial offer for the Australian toll road operator.
The offer from Canada's second-biggest public pension manager values Intoll shares at A$1.52 each, 36% more than before an initial approach was announced on 15 July (Global Pensions: 15 July 2010).
Intoll agreed to the offer after CPPIB increased the Australian dollar component of the offer from 23 Australian cents and C$1.186 ($1.120) for each Intoll share. The value of that proposal had slipped to A$1.495 from A$1.535 at today's foreign-exchange prices, Intoll said.
Intoll chairman Paul McClintock said: "CPPIB is offering a highly attractive premium to pre-15 July 2010 Intoll trading prices, one which better reflects the directors' view of the value of the assets in light of market conditions post the global financial crisis and particularly the increase in the cost of capital.
"The directors of Intoll have carefully considered the proposal and unanimously recommend that Intoll security holders approve the schemes of arrangement and elect to receive the cash proposal in the absence of a superior offer and subject to an independent expert concluding that the schemes of arrangement are fair and reasonable and in the best interests of security holders."
CPPIB senior vice-president, private investments, Andre Bourbonnais added: "Canada Pension Plan Investment Board welcomes the recommendation of the Intoll directors and is continuing the work necessary to complete the schemes of arrangement."
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