Asciano Ltd shares soar on Qube Holdings Ltd takeover bid

Asciano Ltd (ASX:AIO) has today attracted a binding acquisition proposal from a consortium led by peer Qube Holdings Ltd (ASX:QUB).

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

What: The share price of rail freight, port and logistics group Asciano Ltd (ASX: AIO) has leapt over 3% higher on Thursday after receiving a binding proposal by a consortium led by Qube Holdings Ltd (ASX: QUB) to acquire the company.

So What: Back in November on the tail of an acquisition offer from the US-based and NYSE-listed Brookfield Infrastructure Partners (BIP), the 'Qube consortium" made a non-binding proposal with an implied value of $9.25 per Asciano share.

This proposal came after the consortium undertook a swift raid of the share register which saw the consortium emerge with a 19.99% stake in Asciano in late October.

That proposal has now progressed to a binding proposal to acquire Asciano with an implied value between $9.08 and $9.17.

Now What: According to Qube's market announcement, its proposal is superior to Brookfield's, which it says currently has an implied value of $8.77 per Asciano share.

While both offers include an element of cash, there is also an equity component which makes the decision less straight forward for Asciano's shareholders.

One consideration shareholders will need to take into account is Qube's estimate that it can achieve synergies of between $30 million to $50 million per annum from combining the two Ports businesses. This in turn is expected to drive double-digit earnings per share accretion which could be a reason to favour the Qube bid as Asciano shareholders will receive a portion of their consideration in Qube shares, thereby allowing them to participate in this potential upside.

Alternatively, the BIP proposal would see Asciano's shareholders receiving a portion of their consideration in BIP shares. BIP owns and operates utilities, transport and energy businesses around the globe which could prove appealing to some Australian investors keen to increase their exposure to global infrastructure assets.

Motley Fool contributor Tim McArthur has no position in any stocks mentioned. Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »