APA Group Chairman Michael Fraser believes the company’s sustained growth and returns for shareholders are what caught the attention of the CK Consortium.
In June, the consortium, led by CK Infrastructure (CKI), lodged a $13 billion takeover bid for APA in an offer valuing each of the company’s shares at $11.
Speaking at APA’s Annual General Meeting (AGM) on 25 October, Mr Fraser said, “APA has had a long-term focus on growing the business and growing returns to our securityholders – and we’ve done that very successfully.
“That success has caught the attention of others – most notably the CKI group.”
Mr Fraser stressed to attendees of the AGM that the company’s board had never put the “for sale sign up for APA”, adding that the CKI offer was “unsolicited”.
“Having received the offer, the board had a fiduciary duty to assess it and determine whether we believed it was in the best interests of securityholders to engage with CKI and try and progress the offer,” he said.
“Which we did, and entered into an implementation agreement with the consortium.”
The acquisition is currently with the Foreign Investment Review Board for approval, with Federal Treasurer Josh Frydenberg having the final say on the deal.
Mr Fraser said that if the takeover was approved by Minister Frydenberg, the securityholders would have the opportunity to vote on whether to proceed with the transaction.
“If the transaction does not proceed, for APA the position is simple, we will revert to our original plan A, which is to continue on with the successful growth strategy we have employed for almost two decades,” he said.
In September, Australian Competition and Consumer Commission Chair Rod Sims said the proposed acquisition created concerns over competition; however, CK Consortium’s undertaking to sell a significant portion of APA’s portfolio addressed this issue.
Speaking to Pipeline, Plant and Offshore (PPO) following the release of APA’s financial year results, APA Group CEO and Managing Director Mick McCormack said the company would continue to invest and grow its extensive infrastructure portfolio despite the potential of the takeover.
For more information visit the APA website.
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