(Bloomberg) — Brookfield Infrastructure Partners LP raised its hostile offer for Inter Pipeline Ltd. to C$8.4 billion ($6.9 billion) as it sought break up the company’s takeover by Pembina Pipeline Corp. announced a day earlier.
Brookfield said Wednesday it will make a cash-and-stock offer valued at C$19.75 per share, representing a 4.4% premium to Pembina’s all-stock proposal, and take it directly to Inter’s investors.
The move signals a full-blown takeover battle for Inter, which controls pipeline infrastructure across Western Canada that connects the region’s oil sands and natural gas producers with domestic and foreign customers.
Brookfield said it was granted access to Inter’s data room last month, carried out due diligence and made several takeover proposals. Brookfield said it was “disappointed” by the decision of the pipeline company’s directors to support Pembina’s “inferior” C$8.3 billion offer.
“Pembina must now weigh whether the industrial logic and asset synergies are sufficient to offset increased dilution from a raised counteroffer, or maintain the current offer and let shareholders choose between the two proposals,” analysts at Tudor Pickering Holt & Co. said in a note.
Brookfield and its institutional partners intend to amend its previous offer, which was made in February, no later than June 4.
“We believe that IPL shareholders will reach a different conclusion than IPL’s Board of Directors about which transaction is most compelling to shareholders,” Brookfield said in its statement.
Brookfield said it has received all regulatory and antitrust approvals and can close as early as 10 business days from the filing date of the variation to its offer.
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