News story

Qube, Brookfield stalk Asciano

Wednesday, 24 February 2016 ( #758 ) - Melbourne, Vic, Australia
Asciano's Patrick is the major attraction
Asciano's Patrick is the major attraction
Observers are closely watching the battle for port and rail operator Asciano, after reports rivals Qube and Brookfield Infrastructure are considering a joint bid for the company. Both consortia have told the Asciano board they are in preliminary discussions about a joint bid. The intentions are confirmed in a statement to the ASX, with Asciano chairman Malcolm Broomhead saying the bid is likely to be to be attractive to shareholders. "The discussions are preliminary and a number of steps would need to occur prior to any binding proposal eventuating," he notes. Those steps include financial and regulatory hurdles, including approvals from the Australian Securities and Investments Commission, the Australian Competition and Consumer Commission and the Foreign Investment Review Board. Qube currently holds 19.99% of Asciano, while Brookfield owns 19.33%, according to the Bloomberg news service. Under the proposal, Qube and Brookfield's consortium would acquire Asciano's Patrick container business in a $2.9 billion 50:50 joint venture. The Qube consortium - which includes the Canada Pension Plan Investment Board and the China Investment Corporation - and members of Brookfield's consortium would take over the Pacific National rail business. Brookfield excluded itself from the rail side of the deal to avoid a negative ruling from the ACCC over its ownership of a track business in Western Australia. Brookfield would also pick up Asciano's bulk and automotive port services business, according to media reports. Meanwhile, Business Spectator reports that the pursuit of Asciano is impacting on Qube, which revealed a $5.6 million hit to its bottom line.