Tilt says YES to USD-2.13bn takeover offer

Wind turbines. Photo by: City of Melbourne (http://www.melbourne.vic.gov.au).

March 15 (Renewables Now) - Tilt Renewables Ltd (ASX:TLT) has agreed to be taken private by a tie-up involving domestic utility AGL Energy Ltd (ASX:AGL) and New Zealand peer Mercury NZ Ltd in a deal that gives the Australian power producer a market capitalisation of around NZD 2.96 billion (USD 2.13bn/EUR 1.79bn).

Tilt said on Sunday the board recommends that its shareholders vote in favour of the proposal.

The takeover is planned to be carried out through a Scheme Implementation Agreement (SIA) that calls for Mercury NZ to acquire Tilt's subsidiaries in New Zealand at an enterprise valuation of NZD 770 million. Then, the Powering Australian Renewables fund (PowAR), which is a partnership between AGL Energy, Queensland government-owned investment group QIC and the federal government’s Future Fund, will acquire all the shares in Tilt and thus assume ownership of its Australian subsidiaries.

The offer was made after Tilt’s largest shareholder Infratil Ltd (NZE:IFT) started a strategic review process aiming to assess options for its 65.5% ownership stake in Tilt. Under the offer, the New Zealand-based infrastructure investor, along with Tilt’s other shareholders, will receive NZD 7.80 per share in cash. Mercury NZ is already the second largest stockholder with a 19.92% stake in Tilt.

Tilt said its shareholders will be able to vote on the scheme, already supported by Infratil and Mercury, at a meeting that will be held in about four months.

AGL, which has a 20% interest in PowAR, separately said it will contribute AUD 341 million to fund its portion of PowAR’s acquisition of the Australian business.

At present, Tilt has 836 MW of wind farms in operation and under-commissioning in Australia and New Zealand, among which is the 336-MW Dundonnell wind park in Victoria. Its pipeline of projects under development exceeds 5 GW in capacity, mostly wind and solar.

(NZD 1.0 = USD 0.720/EUR 0.603)

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Veselina Petrova is one of Renewables Now's most experienced green energy writers. For several years she has been keeping track of game-changing events both large and small projects and across the globe.

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