THE long-running takeover for the pipeline owner and operator Hastings Diversified is moving into the final lap, with the independent directors recommending a friendly bid from a party associated with the company.
The recommendation comes before the final decision from the competition regulator regarding a rival bid from APA Group, the biggest in the industry, which is due next week.
If the Australian Competition and Consumer Commission clears APA of the competition concerns related to its offer, APA is expected to pitch its bid closer to the $2.32? offer on the table, which is well above APA's opening bid of about $2.
Yesterday the independent directors of Hastings Diversified accepted a $1.2 billion offer from Pipeline Partners Australia, which is controlled jointly by Hastings-group member Utilities Trust of Australia and Caisse de depot et placement du Quebec.
Utilities Trust has a 40 per cent holding in Pipeline Partners, and two Canadian investors, Kindle Capital and CN Investments, hold 10 per cent.
An independent assessment of the Pipeline Partners bid is yet to be made but Westpac has opted to accept the offer for its 8.1 per cent holding in Hastings, even though the competition regulator is yet to decide whether the APA offer can proceed.
As the owner of the management companies of both Utilities Trust and Hastings Diversified, Westpac's quick decision has raised questions over whether it is putting its own corporate interests ahead of other shareholders.
The Pipeline Partners offer has several conditions, including a stipulation that it must gain control of 70 per cent of Hastings Diversified's capital.
APA is offering 50? in cash and 0.326 APA shares, less any distributions paid this year.
The offer is subject to a 90 per cent minimum acceptance condition.
APA already has a 21 per cent stake in Hastings Diversified.