Inter Pipeline rejects revised hostile takeover offer by Brookfield Infrastructure
Inter Pipeline Ltd. has rejected a revised hostile takeover offer by Brookfield Infrastructure Partners LP that allows shareholders to receive their payment entirely in cash instead of a mix of cash and shares if they want.
The company urged shareholders to reject the offer and support its friendly all-stock deal to be bought by Pembina Pipeline Corp., which would see shareholders receive half a Pembina share for each Inter Pipeline share they hold.
Inter Pipeline said Monday it continues to believe its deal with Pembina provides greater value for shareholders.
"Brookfield's latest bid variation, the removal of its cash proration condition, does not change our view that the Pembina Arrangement remains the superior proposal and is in the best interests of Inter Pipeline and its shareholders," Inter Pipeline chair Margaret McKenzie said in a statement.
Brookfield Infrastructure said last week it would eliminate a cap on the amount of cash available under its proposal after what it says was feedback from institutional and event-driven investors.
It has offered $19.50 in cash or 0.225 of a Brookfield Infrastructure class-A exchangeable share for each Inter Pipeline share. It has also said that it is prepared to increase the cash portion of its bid by up to 90 cents per share if it is successful in its challenge at the Alberta Securities Commission of a $350-million break fee Inter Pipeline would have to pay Pembina.
In its own application to the Alberta regulator, Inter Pipeline is seeking to force Brookfield Infrastructure to provide greater disclosure related to a total return swap that it says gives it economic exposure to 9.9 per cent of Inter Pipeline's shares in addition to the 9.75 per cent stake in the company it owns.
Inter Pipeline and Pembina are concerned Brookfield may use the total return swap in an effort to block shareholder approval of the Pembina deal.
Pembina's offer for Inter Pipeline requires approval by a two-thirds majority vote by Inter Pipeline shareholders as well as a simple majority vote by Pembina shareholders and regulatory approvals.
Pembina said it is important that all shareholders involved in a large transaction be given transparency and a fair, unencumbered process to choose the deal that they determine to be in their best interests.
"This is equally important for sophisticated investors and individual retail holders," Pembina chief executive Mick Dilger said in a statement.
"Brookfield cannot use its 'block' of shares to threaten the strategic merger with Pembina, while at the same time claiming that it does not control these shares and that they count toward acceptance of its tender offer. Brookfield is clearly conflicted and must step back and let Inter Pipeline's other shareholders choose the best offer."
This report by The Canadian Press was first published June 21, 2021.
CTVNews.ca Top Stories
Quebec nurse had to clean up after husband's death in Montreal hospital
On a night she should have been mourning, a nurse from Quebec's Laurentians region says she was forced to clean up her husband after he died at a hospital in Montreal.
Cuban government apologizes to Montreal-area family after delivering wrong body
Cuba's foreign affairs minister has apologized to a Montreal-area family after they were sent the wrong body following the death of a loved one.
What is changing about Canada's capital gains tax and how does it impact me?
The federal government's proposed change to capital gains taxation is expected to increase taxes on investments and mainly affect wealthy Canadians and businesses. Here's what you need to know about the move.
'Anything to win': Trudeau says as Poilievre defends meeting protesters
Prime Minister Justin Trudeau is accusing Conservative Leader Pierre Poilievre of welcoming 'the support of conspiracy theorists and extremists,' after the Conservative leader was photographed meeting with protesters, which his office has defended.
Northern Ont. lawyer who abandoned clients in child protection cases disbarred
A North Bay, Ont., lawyer who abandoned 15 clients – many of them child protection cases – has lost his licence to practise law.
Boeing's financial woes continue, while families of crash victims urge U.S. to prosecute the company
Boeing said Wednesday that it lost US$355 million on falling revenue in the first quarter, another sign of the crisis gripping the aircraft manufacturer as it faces increasing scrutiny over the safety of its planes and accusations of shoddy work from a growing number of whistleblowers.
Bank of Canada officials split on when to start cutting interest rates
Members of the Bank of Canada's governing council were split on how long the central bank should wait before it starts cutting interest rates when they met earlier this month.
Fair in Ontario, flurries in Labrador: Weather systems make for an erratic spring
"It's a bit of a complicated pattern; we've got a lot going on," said Jennifer Smith of the Meteorological Service of Canada in an interview with CTVNews.ca on Wednesday. "[As is] typical with weather, all of these things are related."
Police tangle with students in Texas and California as wave of campus protest against Gaza war grows
Police tangled with student demonstrators in Texas and California while new encampments sprouted Wednesday at Harvard and other colleges as school leaders sought ways to defuse a growing wave of pro-Palestinian protests.