October 15, 2007 09:12 am
TransAlta Power, L.P. agrees to be acquired
CALGARY, ALBERTA--(Marketwire - Oct. 15, 2007) - TransAlta Power, L.P.
(TransAlta Power) (TSX:TPW.UN) today announced it has entered into a
support agreement (the Support Agreement) with Cheung Kong Infrastructure
Holdings Limited (CKI), pursuant to which CKI has agreed to offer $8.38 in
cash per unit (the Offer) to acquire all of the outstanding units of
TransAlta Power. The purchase price under the Offer represents a 15.7 per
cent premium over the closing trading price of the units on the TSX on
October 12, 2007, the last trading day immediately prior to this
announcement. The all-cash transaction is valued at approximately $629
million, excluding debt. Under certain circumstances, TransAlta Power has
agreed to pay a non-completion fee of $17 million to CKI.
"The Board is pleased to announce the successful completion of the
strategic review process conducted by the Independent Committee," said
Stephen Mulherin, Chairman of the Board of Directors of the General Partner
of TransAlta Power, TransAlta Power Ltd. "Through the process we reviewed a
myriad of alternative proposals. The Board has concluded that the sale to
CKI provides the best opportunity to maximize unitholder value."
CKI is the largest publicly listed infrastructure company in Hong Kong with
diversified investments in Energy Infrastructure, Transportation
Infrastructure, Water Infrastructure and Infrastructure Related Business.
Operating in Hong Kong, Mainland China, Australia, the United Kingdom,
Canada and the Philippines, it is a leading player in the global
infrastructure arena. Its expansive energy portfolio comprises both
electricity generation and distribution assets, as well as gas companies
all over the world.
On May 22, 2007, TransAlta Power announced that an Independent Committee of
the Board of Directors of TransAlta Power Ltd., was conducting a review of
strategic alternatives for the purpose of maximizing value for the
unitholders of TransAlta Power. On the basis of a review of the strategic
alternatives available to TransAlta Power, the Independent Committee
recommended to the Board of Directors of TransAlta Power Ltd. the entering
into of the Support Agreement by TransAlta Power and that acceptance of the
Offer be recommended to the unitholders of TransAlta Power.
BMO Capital Markets acted as financial advisor to TransAlta Power Ltd. The
Board of Directors of TransAlta Power Ltd. has received a verbal opinion,
subject to review of final documentation, from BMO Capital Markets that the
consideration to be received under the Offer is fair from a financial point
of view to the unitholders of TransAlta Power.
Following a thorough review by the Board of Directors of TransAlta Power
Ltd., consultation with its legal and financial advisors and recommendation
of the Independent Committee, the Board of Directors of TransAlta Power has
unanimously determined the Offer is fair to the unitholders of TransAlta
Power. The Board has also determined that it is in the best interests of
TransAlta Power and its unitholders that TransAlta Power enter into the
Support Agreement and unanimously recommends that unitholders of TransAlta
Power accept the Offer.
A take-over bid circular, containing the terms and timing of the Offer,
will be mailed to unitholders in the next few weeks, together with a
directors' circular. Once mailed, the take-over bid circular and the
directors' circular will be available on the Canadian Securities
Administrators' System for Electronic Document Analysis and Retrieval
("SEDAR") website at www.sedar.com.
The Offer will be subject to customary conditions, including receipt of all
necessary regulatory approvals and at least 66 2/3 per cent of the
outstanding units of TransAlta Power having been validly deposited under
the Offer and not withdrawn.