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The Victorian-focused pipeline and infrastructure specialist yesterday released its target statement to the market in response to the unsolicited takeover offer.
GasNet said it has a sustainable distribution business, while BBI has a different profile and shareholders have no assurance of capital gains tax roll-over relief.
“This offer materially undervalues GasNet’s high quality, low-risk, strategic portfolio of assets,” chairman Rodney Keller said.
“Our securityholders are being asked to adopt a very different risk profile by accepting BBI securities and are being offered no premium in exchange.”
Supporting the directors’ recommendation is an independent report undertaken by Lonergan Edwards, which concluded the offer was “neither fair nor reasonable”, according to GasNet.
GasNet also announced it would increase this year’s interim dividend by 10% to 11c per share, based on a strong performance in the first half.
The company’s suite of assets are based around 1930km of high-pressure gas transmission pipeline networks and include a gas pipeline from Esso’s Longford gas treatment plant in southwest Victoria.
BBI, a subsidiary of Babcock & Brown, and APT already hold a 14.2% interest in GasNet and say the offer represents a 12.3% premium to the average share price in the month to June 16.
The offer of 1.5455 new Babcock securities for each GasNet security values GasNet at $A2.52 per security.
