TransAlta gets $39-a-share bid from Luminus and Global Infrastructure Partners HED IS 80 CHARACTERS
CALGARY - TransAlta Corp. (TSX: TA.TO) is the target of a private-equity takeover proposal valued at $39 per share in cash - a total of about $7.8 billion. TransAlta disclosed today that it has received a non-binding approach from Luminus Management LLC and Global Infrastructure Partners.
The proposal represents a premium of 21 per cent over the Alberta-based power generator's TSX price Friday of $32.25, with a 52-week range between $37.60 and $27.07.
TransAlta said its board "will carefully consider the letter and will respond in due course."
New York-based Luminus previously sought to shake up the TransAlta board, aiming to force the company to sell assets and bulk up its debt to buy back shares. Luminus withdrew its alternate slate of directors in March after some of its demands were met, including a deal to sell TransAlta's power business in Mexico.
Global Infrastructure Partners is a New York-based joint venture of Credit Suisse and General Electric.
The letter received Friday evening proposes "engaging in a dialogue about a possible acquisition," TransAlta said. TransAlta chair Donna Soble Kaufman stated that there has been no firm offer and shareholders need not take any action.
TransAlta earned $33 million in its latest reported quarter, down from $56 million in the first quarter of last year as it booked a $65-million writedown on the Mexican assets sold for $304 million in February.
Three-month revenue rose to $803 million from $669 million. TransAlta bought back $60 million of its shares during the quarter and indicated the buyback would grow.
NEW YORK - Oil prices tumbled Tuesday, falling about US$4 a barrel as concerns eased about possible supply disruptions from Tropical Storm Dolly.
The selloff, which came with the existing futures contract set to expire, was a throwback to last week's sharp declines and dragged crude to its lowest trading level since early June.
Light, sweet crude for August delivery fell US$3.80 at $127.24 a barrel on the New York Mercantile Exchange. Earlier, the contract dropped as low as $126.26.
The declines offered further evidence that investors who only a week and a half ago drove prices to a new record above $147 a barrel are now pulling money out of the market. There are also indications that the price of oil is killing demand, especially in the U.S., which consumes far more oil than any other country.
"This is more of the long exit from the market by the hedge funds," said Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates. "A lot of these investors who have been supporting prices are hitting the road"
Prices rose Monday as Tropical Storm Dolly bore down on oil and gas installations in the Gulf of Mexico, but that did little to dent the steep declines left over from last week's sell-off.
Forecasters at the National Hurricane Center in Miami say it is likely Dolly will become a hurricane, but they do not expect it to become a major hurricane.
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