The AustralianSuper proposed scheme of arrangement for IFT poses some interesting questions for the IFTHA bonds. What protections are there for bond holders should there be a change in ownership of the IFT shares? What scope does the Trustee have to intervene on behalf of bond holders?
I see the IFT bonds are repayable should compulsory acquisition of IFT shares held by minorities occur - see page 11 of the prospectus:
Presumably a shareholder approved Scheme of Arrangement doesn’t result in compulsory acquisition occurring (rather it’s something that occurs under a takeover once 90% ownership is achieved) and therefore I assume the IFTHA’s would survive AustralianSuper acquiring IFT via a Scheme of Arrangement.
It would be worthwhile to review the trust deed in detail. If there is any prospect of repayment, the current market price of 53.8 cents in the dollar may move. Or if bond holders are locked in, 53.8 cents is expensive.
Last edited by Southern Lad; 09-12-2020 at 08:30 PM.
The AustralianSuper proposed scheme of arrangement for IFT poses some interesting questions for the IFTHA bonds. What protections are there for bond holders should there be a change in ownership of the IFT shares? What scope does the Trustee have to intervene on behalf of bond holders?
I see the IFT bonds are repayable should compulsory acquisition of IFT shares held by minorities occur - see page 11 of the prospects:
Presumably a shareholder approved Scheme of Arrangement doesn’t result in compulsory acquisition occurring (rather it’s something that occurs under a takeover once 90% ownership is achieved) and therefore i assume the IFTHA’s would survive AustralianSuper acquiring IFT via a Scheme of Arrangement.
It would be worthwhile to review the trust deed in detail. If there is any prospect of repayment, the current market price of 53.8 cents in the dollar may move. Or if bond holders are locked in, 53.8 cents is expensive.
Did scheme of arrangements even exist back then? If not then surely this would be against the intent of the change of control clause?
Would perpetual holders get a vote in the takeover?
The perpetuals are small change in the scheme of things.
VWRAP of 69c for the day and a turnover of $340k suggests many think they will have to be bought out at a face value of $1.
Perpetual shareholders have every reason to vote in favour of the scheme of arrangement and the votes may prove crucial. Infratil and Morrison & Co may be about to pay a price for taking advantage of perpetual shareholders for so long. They could have been buying them back on market at almost half price.
Interesting ?
"Specifically, holders of Infrastructure Bonds may have the right to request that their bond is
redeemed at its face value, and holders of the Perpetual Infratil Infrastructure Bonds (PiiBs) may also
have rights to convert their PiiBs into Infratil ordinary shares."
I wonder what the circumstances for conversion are? https://stocknessmonster.com/announc...ft.nzx-364894/
compulsory acquisition
If any person, or group of Associated Persons, becomes entitled or bound to compulsorily acquire Shares held by any minority Shareholders, Bondholders will be given the option to redeem their Infrastructure Bonds for cash at their $1.00 Face Value plus accrued interest (less any withholding taxes and other deductions) or convert their Infrastructure Bonds by the issuance of the number
of Shares obtained by dividing the $1.00 Face Value by the product of the relevant Conversion Percentage
and the Market Price. Unless the Bondholder pays any withholding tax or other deduction to Infratil before conversion, the number of Shares issued will be adjusted in accordance with the formula in the Trust Deed.
If any person, or group of Associated Persons, acquires beneficial ownership of 90% or more of all Infrastructure Bonds such person will become bound to offer to acquire the balance of the outstanding Infrastructure Bonds at prices that an Independent Expert has determined to be fair.
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Originally Posted by Gonzo
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