We discussed APA in detail in both March Here while also touching on its stable income stream for our income portfolio in April Here. This is a business that’s turned itself around nicely over the last year, allaying the markets concern around the sustainability of their dividend. We had originally targeted a move to $10, but the stock continues to screen well, supported by a strong yield.
APA was subject to a $13 billion takeover approach from CK Infrastructure back in 2018 that was blocked by the federal government on national security grounds. The foreign ownership sensitivity remains, but a domestic buyer, or a consortium led by Australian super funds, would face a very different regulatory pathway. An IFM-led consortium or Australian super fund collective could acquire APA without triggering FIRB national security concerns. Gas pipeline infrastructure with long-dated regulated revenue is exactly the asset class private capital is hunting right now.
MM doesn’t buy stocks in anticipation of a takeover, but we do like it when it’s the cream on the cake of a stock we already like, such as National Storage (ASX:NSR), which MM owned when the bid hit in November 2025.
- We can see a test of $11 over the coming year with its 5.7%, part-franked yield, providing support: MM owns APA in its Active Income and Active Growth Portfolios.
MM is long and bullish towards APA around $10
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