Insights

Spark Infrastructure (ASX:SKI) share price rallies 7% on confirmed bid

A confirmed buyout proposal has added an extra ‘spark’ to this company’s shares…
The post Spark Infrastructure (ASX:SKI) share price rallies 7% on confirmed bid appeared first on The Motley Fool Australia. –

The Spark Infrastructure Group (ASX: SKI) share price is climbing higher today. This comes after the energy network operator confirmed it had received a takeover bid. Shares in the company have resumed trading following the announcement.

At the time of writing, the Spark Infrastructure share price is trading hands for $2.65 – up 6.85%.

Let’s take a look at the news driving the company’s shares higher today.

Takeover proposal switches on Spark Infrastructure’s share price

Investors are buying up shares in the energy network operator today following its latest announcement.

After having entered a trading halt yesterday amid rumours of a potential buyout offer, Spark has cleared the air. According to the release, it had received a conditional and non-binding indicative proposal from Ontario Teachers’ Pension Plan Board (OTPP) and Kohlberg Kravis Roberts & Co (KKR).

The proposal from the consortium sought to acquire 100% of the company’s shares by way of a scheme for all cash consideration at $2.70 per share. Additionally, the offer would be reduced by the value of the proposed dividend of 6.25 cents per security. As a result, the final consideration valued each share at $2.6375.

All things considered, the board unanimously determined the offer undervalued Spark Infrastructure and its share price. Following this, the consortium made a subsequent offer of $2.80 – once again reduced by the dividend payment.

Spark Infrastructure $SKI has rejected a $2.80 per stapled security all-cash takeover offer made by KKR and the Ontario Teachers’ Pension Plan Board. $SKI‘s Board ‘…unanimously concluded that the price undervalued’ the company.

— CommSec (@CommSec) July 15, 2021

And once again, the company concluded the follow-up offer undervalued Spark. Although access to due diligence has been withheld, the board indicated it was willing to share limited information regarding the business and its prospects.

Spark Infrastructure concluded its announcement by stating:

Irrespective of whether the engagement between Spark Infrastructure and the Consortium results in further revised proposals, the Board considers that Spark Infrastructure has a highly attractive future and is well positioned to continue to deliver an attractive yield now with franking credits coupled with strong growth in its underlying high-quality asset base and has strong ESG credentials given its important role in supporting the multi-decade energy transition to a lower carbon future.

Renewable energy hub development announced

The company took the opportunity to announce its new renewable energy hub proposal in a separate update.

According to the update, Spark plans to develop a generation and storage hub in South-West New South Wales. This facility, dubbed the Dinawan Energy Hub, is intended to have up to 2.5 gigawatts of capacity.

Additionally, the hub will consist of hybrid wind, solar, and battery storage. The proposed location is situated on the route of the EnergyConnect interconnector. This will run between Wagga Wagga in NSW and Robertstown in South Australia.

Furthermore, Spark noted it would be strategically positioned to the Snowy Hydro 2.0 and KerangLink interconnectors.

Commenting on the proposed development, Head of Spark Renewables, Anthony Marriner said:

We are only at the start of the development process and the proposed project must undergo a rigorous planning and assessment process which includes environmental studies. We are also committed to extensive community and stakeholder consultation to identify the possible environmental, economic and social impacts, as well as opportunities and mitigation measures.

Following the surge in the Spark Infrastructure share price, the company now holds a market capitalisation of $4.77 billion

The post Spark Infrastructure (ASX:SKI) share price rallies 7% on confirmed bid appeared first on The Motley Fool Australia.

Should you invest $1,000 in Spark Infrastructure right now?

Before you consider Spark Infrastructure, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Spark Infrastructure wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of May 24th 2021

More reading

Spark Infrastructure (ASX:SKI) share price frozen on possible takeover bid
How did ASX renewable energy shares perform in FY21?

A dividend bonanza could be inbound for ASX shares, here’s why

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!