Brookfield Infrastructure (TSE:BIP.UN) (NYSE:BIP), backed by Canada’s largest alternative asset manager, has agreed to buy Australian rail freight firm, Asciano (OTCMKTS:AANOF).
The terms value Asciano at about A$12bn ($8.84bn) including debt.
Asciano shareholders will receive A$6.94 in cash and A$2.21 in Brookfield Infrastructure units for every share held. The offer has an implied value of about A$9.15 a share, the Bermuda-based infrastructure arm of Brookfield Asset Management said in a statement on Monday.
The offer is a 13% percent premium to Asciano's last traded price of A$8.11. Asciano requested a trading halt on Monday, as is standard on the Aussie stock exchange.
Foreign investors have been buying Australian transport assets amid a decline in the local currency and government plans for spending on infrastructure.
"This transaction enables us to acquire premier transport infrastructure assets in a geography we know well and establish two leading global platforms, with solid long-term prospects," Sam Pollock, chief executive officer of Brookfield Infrastructure, said in the statement.
The combination of Brookfield Infrastructure and Asciano will create a leading global rail, port and logistics business.
Asciano operates Patrick, a stevedoring business, at ports including Melbourne, Sydney and Brisbane. It also offers freight services through its Pacific National rail business.
Brookfield Infrastructure owns utilities, transport, energy and communications infrastructure in North and South America, Europe and Australia. It owns the Westnet rail business in Western Australia state and controls the Dalrymple Bay Coal Terminal in Queensland.