DataRoom AM: Stokes in the spotlight

Billionaire Kerry Stokes appears desperate to be at the centre of oil and gas consolidation in Australia as Seven Group strikes its first big blow in the sector, but it isn’t the only non-media industry in which he is playing a major role in M&A action.

Elsewhere, a bidding battle stirs for Treasury Wine Estates, RetireAustralia opts to hold off on an IPO, Macquarie Group pushes back against a sale of a major Brisbane toll road and Frasers Centrepoint holds firm in negotiations with Stockland.

Kerry Stokes has enjoyed a busy start to the week, wrapping up a healthy return from his majority stake in the ASX-listed takeover target Iron Ore Holdings just as his Seven Group all but secures control of Nexus Energy. The fate of Nexus was sealed at a meeting of creditors yesterday, with unanimous approval given for Seven’s $180 million takeover proposal. The deal should kickstart an era of oil and gas expansion for Seven under the leadership of former Woodside Petroleum chief Don Voelte, who incidentally served as chair of Nexus until Seven lobbed a takeover bid earlier this year.

Meanwhile, the Stokes-backed Iron Ore Holdings has accepted a $250m cash-and-scrip bid from rival BC Iron, which will leave the billionaire with 19 per cent of the enlarged company. It’s just the latest sign of activity in the WA iron ore sector after the recent takeover of Aquila Resources and the planned sale of Cliffs Natural Resources’ Koolyanobbing assets. With iron ore prices falling heavily this year, there may be more consolidation to come in the sector.

A one-horse takeover race seemed the obvious conclusion to Treasury Wine Estates’ life on ASX boards, but it appears far from a sure bet after a new bidder emerged yesterday, albeit still lingering in the shadows. It is believed the firm behind the rival offer to the KKR-Rhone Capital consortium is TPG Capital, with the private equity group granted entrance into the data room of TWE. At this stage both KKR and TPG (assuming rumours of the latter’s involvement are true) have put forward bids of $5.20 a share.

Investors are confident a higher bid will be forthcoming, with stock in TWE 2.5 per cent above the prices put forward by both suitors, but a bidding war between private equity firms appears an unlikely outcome.

In infrastructure, Macquarie Group is likely to ignore suggestions to divest the AirportLinkM7 toll road in Brisbane, The Australian Financial Review reports. Macquarie, and the lending consortium behind troubled BrisConnections, claimed control of the controversial toll road 18 months ago as receivers were called in by BrisCon. Reports suggest that most of the lenders will angle for a sale at a meeting of creditors on Thursday, but leading debt owner Macquarie is believed keen to hold onto the asset.

In the IPO market, RetireAustralia has abandoned a 2014 push to list on the ASX, with pricing likely at the heart of the decision from owners Morgan Stanley and JP Morgan. The $600m IPO of the aged care operator was to be one of three such companies to join the local market in the back half of the year, alongside Regis Aged Care and Estia Health.

In property, the new majority owner of Australand, Singapore’s Frasers Centrepoint, has no intention to deliver a bonus to failed suitor Stockland. The latter still holds 19.9 per cent of Australand but talks to progress a side deal are reportedly strained, leaving Frasers to potentially delist Australand on August 21 while still holding less than 90 per cent of its stock.

Elsewhere, speculation is swirling around the logic for a tie-up of Wilson HTM Investment Group and rival Shaw Stockbroking, according to the AFR. While the broking sector is ripe for consolidation, there currently appears little depth to the merger rumours.

Finally, the Transurban-backed Westlink M7 toll road in Sydney has successfully refinanced $1.26bn worth of debt with the help of a bevy of banks, including Australia’s ‘big four’.