DataRoom AM: Woodside’s Apache raid

The oil and gas giant is pondering Apache Energy’s Australian and Canadian assets, while another suitor enters the Ten Network picture.

It’s no secret that Woodside Petroleum has both the capital and the desire to set itself up for long-term growth via acquisition, while Apache Energy is undoubtedly a keen seller as it looks to rationalise its portfolio. But will the two firms be able to get a potential $6 billion deal across the finish line?

Elsewhere, another suitor shows its hand in the race for Ten Network, Healthe Care tests interest in a trade sale, Leighton sees positive signs in the auction of Devine and Blackstone makes a last-ditch push for control of Orica’s non-mining chemicals division.

Woodside Petroleum remains hot on the trail of Apache Energy’s Australian and Canadian assets and is weighing a $6 billion play for Apache’s 13 per cent Wheatstone LNG stake, its gas and oil-producing assets in WA, two exploration fields and the Kitimat LNG project in Canada.

The Wheatstone stake is valued at upwards of $2bn, while Kitimat could be worth as much as $1bn and the WA portfolio could come in as high as $3bn. Competition may prove fierce, however, with the WA portfolio already attracting two bids, though Apache has rejected those as they fell short of its $2.5bn-plus valuation. In Woodside’s favour is the downturn on energy markets that may allow for prices to be kept in check.

Meanwhile, Ten Network has found yet another suitor keen to entertain a deal, with US-based Saban Capital Group tipped to house an interest in the troubled media group. Saban has met with Ten management, The Australian Financial Review reports, though it is just one of a long list of possible buyers with Discovery Communications (in a JV with Foxtel), Time Warner, Providence Equity Partners, Anchorage Capital and Fairfax Media all linked to bids. With key shareholder Bruce Gordon adamant he won’t sell, however, it could all come to naught.

In healthcare, IPO candidate Healthe Care may opt for a trade sale over an ASX listing after gauging buyer interest on a roadshow in Asia last month. It was originally thought the Asian trip was the precursor to a float, but it now appears it was largely an exercise to test appetite for a potential $800 million trade sale. China’s Fosun and Malaysia’s IHH could be possible suitors, but if valuations fall short, an IPO remains a solid bet.

In property, Leighton has received good news on its plan to exit its majority stake in developer Devine as private equity firm Proprium Capital Partners is added to the list of prospective buyers. According to the AFR, Proprium will provide competition in the auction to Singapore’s City Developments, Japan’s Daiwa House and local firm AVJennings.

Elsewhere, Blackstone is believed to be furiously trying to shore up a deal with Orica for its non-mining chemicals unit. The AFR reports the private equity firm is desperate to wrap up an $800m deal ahead of Orica’s AGM deadline as the ASX-listed firm leans to a spin-off on the ASX.

In finance, Champ Private Equity is keen to lock in profits on its successful turnaround of the Alleasing business, an offshoot of the collapsed Allco Finance Group. It is believed that Bank of Queensland, FlexiGroup, Macquarie Group and Pepper Australia are weighing bids, with a sale price of about $400m tipped just six years after Champ paid $146m for ownership.

In agriculture, Freedom Foods has secured a major dairy deal with China’s New Hope that will see $500m ploughed into the local agriculture sector.

Finally, A2 Milk has detailed plans to pursue a dual-listing on the ASX in early 2015, Aconex has relaunched an IPO after slashing the size of the offering from $230m to $140m and Pacific Brands has hived off parts of its Brand Collective business.

PacBrands will receive $39m through the sale of footwear and apparel assets to Anchorage Capital Partners and a mix of sports brands and assets to IBML and The PAS Group.

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