CALGARY - Pembina Pipeline Corp. has signed a friendly deal to buy Inter Pipeline Ltd. for $8.3 billion in stock, surpassing a hostile bid by Brookfield Infrastructure Partners.
The offer is valued at $19.45 per Inter Pipeline share based on the closing price of Pembina shares on Monday. Inter Pipeline shares closed at $17.55 but increased $1.53 or 8.7 per cent at $19.08 in afternoon trading on the Toronto Stock Exchange
The deal tops the offer made by Brookfield that was valued at $16.50 per share.
In March, CEO Chris Bayle said the Brookfield bid undervalued their business. After a comprehensive review of strategic alternatives by the special committee of the board of directors of Inter Pipeline, it was evident that a combination with Pembina offered compelling value for Inter Pipeline shareholders in the short-term, said Margaret McKenzie, Inter Pipeline s chairwoman.
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The seismic collapse of oil prices that began one year ago left weakened Canadian energy companies vulnerable to the pressures of consolidation.
Will a sharp recovery in prices change that dynamic in 2021?
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Two different takeover deals are providing insight into how companies and investors see M&A activity playing out this year.
Inter Pipeline Ltd. is trying to fend off a hostile bid from Brookfield Infrastructure Partners LP and is now looking for a better offer.
Varcoe: Energy consolidation escalates as rising oil price eases urgency calgaryherald.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from calgaryherald.com Daily Mail and Mail on Sunday newspapers.