Canadian convenience giant Alimentation Couche-Tard has boosted its bid for Caltex Australia, offering $8.8 billion for the fuel retailer in a drawn-out battle for control of the company.
Caltex confirmed on Thursday the Quebec-based business had submitted a fresh indicative bid of $35.25 per share – an increase of 0.75c per share, or $187.3 million, on its previous offer.
The fresh bid comes after Caltex’s board late last year rebuffed an $8.6 billion unsolicited cash offer from the Canadians, saying it “undervalued” the company and was not “compelling” for shareholders.
In the wake of the rejection, Caltex’s board offered Couche-Tard access to non-public information in an attempt to get it to sweeten its bid.
“Alimentation Couche-Tard has indicated that its revised price is its best and final price in the absence of a competing proposal,” Caltex said in an ASX statement on Thursday.
Couche-Tard operates 16,000 stores across Canada, the United States, Europe, Mexico, Japan, China and Indonesia. Its Circle K brand is well known throughout Asia.
Britain’s EG Group is also circling Caltex, with reports earlier this week it may team up with Macquarie Group to bid for the company.
If it were to offer a successful bid, EG Group would keep Caltex’s main retail business and Macquarie would take on the refinery and infrastructure assets.
British billionaire brothers Mohsin and Zuber Issa control EG Group and have rapidly grown it through acquisitions over the past few years.
Couche-Tard’s latest offer is its third attempt to gain a foothold in Caltex. It first offered $32 per share before upping its price to $34.50 a share.
The fuel retailer’s shares jumped 3.22 per cent to $34 on early trade Thursday.
Caltex offered the now-familiar caveat there was no certainty Couche-Tard’s revised proposal would result in a deal.
Couche-Tard said its offer was subject to due diligence, an agreement on a scheme of implementation, and no asset divestments or capital changes at Caltex in the meantime.
The revised proposal permits Caltex to pay a special dividend to shareholders.
Extracted from The Sydney Morning Herald