APA Group (ASX:APA) offered a non-binding indicative proposal to acquire AusNet Services Ltd (ASX:AST) for AUD 8.8 billion on September 1, 2021. Offer price consists of cash and 0.085 shares, which was equivalent to AUD 2.32 per share. As of APA revised proposal with AUD 1.8 in cash and 0.088 shares equivalent to AUD 2.6 per shares.

As of September 20, 2021, Brookfield Infrastructure launched offer for AUD 9 billion. APA expects to finance the cash consideration under the Superior Proposal with a combination of existing cash and debt facilities on hand, new bridging facilities and an equity raising. APA will retain opportunity for ASX listed investors to invest in AusNet via APA securities, and participate in the benefits of the combined business.

Transaction is subject to due diligence, scheme implementation deed and antitrust approval. The Board of AusNet concluded that the APA Original Indicative Proposal was inferior in respect of price, form of consideration, structure and certainty, and that it was in the best interests of AusNet shareholders to engage with Brookfield on its proposal. The decision of the Takeovers Panel that the “no talk” exclusivity arrangements agreed between AusNet and Brookfield be made subject to a “fiduciary out” in a form acceptable to the Takeovers Panel by no later than October 19, 2021, otherwise the “no talk” will be of no force or effect.

This decision will permit AusNet to respond to APA's Superior Proposal (the “Panel Decision”) from not later than October 19, 2021. APA looks forward to working cooperatively and constructively with the AusNet Board in relation to the Superior Proposal and to agree the terms under which APA would be granted targeted due diligence, in the best interests of AusNet shareholders. As of October 25, 2021, AusNet Services grants due diligence access to APA.

APA also further notes and welcomes the earlier decision of the Takeovers Panel that it had declined to conduct proceedings on an application from Brookfield. In response to the allegations by Brookfield, the Panel concluded that there was no reasonable prospect it would make a declaration of unacceptable circumstances that announcements made by APA contained misleading and incorrect information. As of November 1, 2021, AusNet has agreed the terms of a binding proposal and has entered into a Scheme Implementation Deed, under which Brookfield is to acquire all the shares in AusNet and “no talk” exclusivity arrangement with Brookfield agreed between AusNet and Brookfield be made subject to a “fiduciary out”.

APA notes that AusNet has advised that access to due diligence will be terminated as result. APA is being advised by Aquasia, Goldman Sachs, J.P. Morgan, and Macquarie as financial advisers and King & Wood Mallesons as legal adviser. AusNet is being advised by Adara Partners and Citi as financial advisers, and by Allens as legal adviser.