CPE Capital consortium, which has made a $3.50 per share cash buyout proposal for Bingo and includes a Macquarie infrastructure fund, Macquarie Infrastructure and Real Assets, is likely to face scrutiny from the Australian Competition and Consumer Commission (ACCC) which is likely to insist on small divestments should the bid succeed.
This stems back to the acquisition by CPE of a Bingo waste facility at Banksmeadow in Sydney for $50 million 2019. The ACCC had compelled the sale of that asset as part of approving the broader $578 million acquisition of Dial-A-Dump.
According to Australian Financial Review which broke the story on Tuesday, an ACCC spokesman said ”if the sale proceeds, the ACCC would closely examine the likely effect of the transaction on competition”.
Bingo shares climbed by 20.4 per cent to close at $3.30 on Tuesday. The cash proposal is at a 28 per cent premium to the closing price of $2.74 on Monday.
Bingo told the ASX that the buyout proposal also involved an alternative structure at a lower price involving cash and unlisted scrip, which has the potential to go higher provided certain earnings hurdles are met following an ownership change.
“The proposal is being considered by an independent board committee of Bingo and discussions and due diligence with the consortium has been ongoing,” Bingo said.
The independent board committee set up by Bingo to consider the proposal comprises directors Elizabeth Crouch, Barry Buffier and Maria Atkinson.