Iberdrola locks in improved takeover offer for Infigen

Spain’s Iberdrola has locked in its increased offer for Australia’s largest ASX-listed renewable energy generator after securing an additional 13% of the target’s shares. With no word yet from its rival bidder, UAC Energy, which is controlled by Philippines-based Ayala Corporation, the Infigen board continues to unanimously recommend its stakeholders to accept the bid valued at $893 million.

Earlier this week, Iberdrola once again increased its off-market takeover offer for Infigen to $0.92 per share on the condition that it secured the approval of a further 13.1% of shares from major Infigen shareholder TCI before the end of the month. With the approval confirmed on Friday, the Spanish firm now holds 38% of the target’s shares and will have the next two weeks to get the rest of Infigen’s register to accept its offer.

The latest improved offer came after a month-long takeover battle that previously saw UAC Energy raise its offer for Infigen to $0.86 per share and Iberdrola increase its bid to $0.89. It comes around a week after Ayala signaled it would not improve its bid any further.

The Philippines company was first to announce its takeover bid for Infigen last month after it took a 12.8% stake in the target company through an on-market raid. Following a preliminary analysis, Infigen termed the original $777 million bid from UAC as “opportunistic” and “highly conditional” and raised concerns about whether the offer was fully-funded. 

Two weeks later, Iberdrola made an $840.6 million bid for Infigen Energy, topping the UAC’s offer. The Bilbao-based utility made “the friendly takeover offer” in a bid to strengthen its presence in Australia. In January, Iberdrola announced its first project in the Asia-Pacific — a 320 MW hybrid solar and wind plant to be constructed near Port Augusta in South Australia in partnership with Ireland’s DP Energy.

Globally, Iberdrola has committed to invest €10 billion (AU$ 16 billion) by the end of 2020 as it seeks to further expand its project pipeline in the years to come. The company says its renewable pipeline now stands at 58,000 MW.

If successful in its bid, the Spanish giant will expand its Australian portfolio through Infigen’s 670 MW of wind generation assets, 268 MW of firming assets, including a 25MW/52MWh Tesla battery collocated with the Lake Bonney Wind Farm in SA, 246 MW of additional renewable capacity through offtake PPAs, and more than 1 GW strong development pipeline.