Off-grid power generation specialist Zenith Energy looks like going into private hands after an entity owner by Pacific Equity Partners (PEP) made a bid to acquire the ASX-listed company.
The bid from Elemental Infrastructure BidCo, which has been unanimously recommended by Zenith’s board of directors, values Zenith’s equity at around A$150 million ($98 million) and enterprise value at some $250 million.
It would see all Zenith shareholders receive A$1.01/share in cash, which represents a 45.3% premium to the last closing price of Zenith shares on March 6 of $0.695/share.
Zenith has gained in prominence since becoming a public entity in May 2018. This has seen it deploy several hybrid power solutions including solar and diesel power at gold and base metal operations in remote parts of Australia. Some of its standout work includes a diesel installation at Newmont’s Tanami gold operation in the Northern Territory and a solar project at Independence Group’s Nova nickel-copper-cobalt mine in Western Australia.
Peter Torre, Chairman of Zenith’s Independent Board Committee, said: “Zenith has regularly reviewed opportunities that align with its strategy to maximise shareholder returns. The Zenith Board believes the proposal from Elemental represents an opportunity for shareholders to receive compelling and certain value. The proposal delivers a significant premium and recognises the success of Zenith as a leading provider of reliable energy solutions in the Asia Pacific region.”
Pacific Equity Partners Managing Director, Andrew Charlier, said: “PEP has a strong history in backing management teams in the remote power sector and with the additional capital firepower PEP can bring to Zenith, we are highly optimistic about the company’s future growth.”
Subject to shareholder approval being obtained by Zenith shareholders and the other conditions of the scheme being satisfied, the scheme is expected to be implemented in June 2020.