Z Energy board recommends shareholders accept $2 billion Ampol offer
Monday, 11 October 2021
Z Energy’s board has recommended shareholders accept an improved takeover offer from Australian fuel retailer Ampol.
The offer would see Ampol pay shareholders $3.78 for each of their shares, and is worth in the region of $2 billion.
Z Energy shareholders would also get the first NZ$0.05 per share of the interim full year 2022 dividend, taking the value of the offer with to $3.83 per share.
The takeover officer would have to be approved by Z Energy’s shareholders, but any deal would have to be passed by the Commerce Commission.
**READ MORE:
* Australia's Ampol makes $1.97 billion takeover offer for Z Energy
* Possible spanner in $441m sale of Trustpower's retail arm to Mercury
**
When the takeover bid was announced in August, Ampol signalled it would sell Gull, if the Commerce Commission made that a condition of allowing the proposed takeover of Z Energy to go ahead.
Ampol said it had now started work on selling Gull, which could be done either through a trade sale, or by an initial public offering on the NZX sharemarket.
In a statement to the NZX, Z’s board of directors unanimously recommend shareholders vote in favour of the takeover, and intended to vote shares controlled by them in favour of the proposed transaction.
Z Energy chair Abby Foote said: “The Z Board is unanimous in recommending this offer to Z shareholders.
“The board has been focussed on the best interest of Z shareholders and has engaged constructively with Ampol over several months to secure additional value beyond the initial approach in June.
“The Z board believes that the scheme represents fair value for Z shareholders,” she said.
The board was also satisfied that Ampol would continue to invest in New Zealand’s energy transition towards a low carbon future and its scale would deliver advantages for the fuel industry in New Zealand.
Mike Bennetts, Z Energy’s chief executive said: “Z and Ampol share a focus on safe and reliable operations and delivering for our customers. Z will be able to tap into Ampol’s significant supply chain, including trading and shipping operations, that will deliver scale benefits to Z.
“Ampol’s focus on a low carbon energy future will add expertise to Z’s already well-developed work in this area. In the meantime, Z will stay focused on running the business and delivering on the relevant strategic objectives that we discussed at Z’s Investor Day in July.”
The offer represented a 37.8 per cent premium to the one-month volume weighted average price up to July 28, the board said.
Bennetts told investors in an online briefing on Monday morning that a shareholder meeting to vote on the takeover would be held in February or March.
To pass, half of all shareholders must vote, and 75 per cent of them would need to vote in favour of the takeover.
As well as approval from the Commerce Commission, Ampol would also have to get approval from the Overseas Investment Office to take over Z Energy.
Bennetts said the takeover would be the largest and most complex application yet handled by the OIO since rules were introduced allowing it to decline sales of New Zealand asset that were not in the national interest.
The takeover would also have to be approved by the High Court.
Completion is expected to occur, after regulatory approvals have been obtained, in the first six months of next year.
In a statement to the ASX sharemarket, on which Ampol shares are listed, said Gull had a 7 per cent market share by fuel volume sold, compared to Z Energy’s 40 per cent market share.
“Ampol is exploring both trade sale and IPO options for the divestment of Gull and has commenced preparatory work for both options,” Ampol said.
That could see Gull becoming available for KiwiSaver funds to invest in.