We discussed IFM’s bid for ALX at the time Here. IFM has been building its stake in Atlas Arteria for eight years, and it always felt like a case of when, not if, a takeover would eventuate. The stocks’ near 50% decline from its 2022 high made the valuation too compelling to resist for IFM Investors — the global infrastructure asset manager owned by 15 Australian industry superannuation funds.
IFM’s lack of engagement with ALX before they lobbed the bid into the markets is probably a sign of frustration around recent performance. We cannot see them walking away now that they’ve started the process, although ALX still have to play their card (s). If they reject at $5.10, IFM either walks or comes back with a higher number. Given IFM already owns +35% and has nowhere to go, we feel the smart money is on a higher offer eventually emerging.
- The $5.10 offer could easily move up towards the $5.50 level in the coming weeks, assuming IFM are determined to deal.
