Brookfield Infrastructure Partners L.P. (NYSE: BIP) experienced a significant setback in its market performance yesterday, concluding the trading session with a notable 4.79% decline, bringing the closing price to $24.46. This decline persisted despite a favorable recommendation from a financial analyst.
On October 18, 2023, National Bank Financial Inc elevated their assessment of Brookfield Infrastructure, upgrading it from a “Sector Perform” status to an “Outperform” status. Remarkably, they opted to retain the price target at a consistent level of $33.
However, in a significant development today, Brookfield Infrastructure and Antin Infrastructure Partners have emerged as prominent contenders seeking a strategic stake in Techem, a respected German metering firm. Partners Group, a Swiss asset management firm, is divesting its majority share in Techem, with an anticipated acquisition price of around 9 billion euros ($9.50 billion), although preliminary offers may hover around 7 billion euros.
This development has triggered a dual-track process, potentially leading to a sale or an Initial Public Offering (IPO). Management meetings have taken place, with plans to circulate sale documentation next month and solicit bids by the end of the fiscal year. A decision on the IPO alternative is expected in the subsequent year after evaluating bids.
Amidst a challenging European economic landscape, IPOs carry risks, as highlighted by Renk’s recent IPO withdrawal. If this transaction proceeds as planned, it will be one of Germany’s most significant deals in recent months. Notable participants include KKR, Blackstone, GIP, and Macquarie, with discussions of forming consortia to amass the necessary equity.
In a separate development, Brookfield Infrastructure Partners has set up an automated purchase arrangement, along with Brookfield Infrastructure Corporation, with approval from the Toronto Stock Exchange. These plans aim to facilitate the acquisition of limited partnership units and exchangeable subordinate voting shares while adhering to trading parameters, particularly during periods when market activity is restricted due to internal trading regulations or other relevant considerations.
