Ampol has executed a binding scheme implementation agreement (SIA) to acquire 100 per cent of Z Energy for NZ$3.78 per share.
Following the closure of New Zealand’s sole refinery at Marsden point, the country’s market is expected to transition to a fuel import market, converting the point into an import-only terminal by mind-2022.
Ampol said this created a highly strategic acquisition opportunity for the company to add significant value to the New Zealand market.
Ampol’s bid followed earlier unsolicited proposals in June, which Z said did not adequately value the company’s business sufficiently to justify the requested exclusivity or confirmatory due diligence access.
When Ampol submitted its bid of NZ$3.78 per share, the board’s assessment of the proposal was that it would be in the best interests of the company and shareholders to grant Ampol a four-week period of exclusivity to undertake the necessary due diligence.
On 27 September, Z announced the exclusivity period had been extended to 11 October to allow both parties to agree transaction documentation.
Z and Ampol have now concluded those negotiations and have entered into a binding scheme implementation agreement.
Z Energy chair Abby Foote said the board of directors unanimously recommended that shareholders vote in favour of the scheme.
“The board is unanimous in recommending this offer to Z shareholders, the board has been focused on the best interests of Z shareholders and has engaged constructively with Ampol over several months to secure additional value beyond the initial approach in June,” said Foote.
“The board took the opportunity to obtain feedback from shareholders on the proposal and that has played an important role in finalising the terms of the deal.”
CEO Mike Bennetts added that Z and Ampol share a focus on safe and reliable operations for customers, and this common understanding would benefit a future partnership.
“Z will be able to tap into Ampol’s significant supply chain, including trading and shipping operations, that will deliver scale benefits to Z,” said Bennets.
“Ampol’s focus on a low carbon energy future will add expertise to Z’s already well-developed work in this area.
“In the meantime, Z will stay focused on running the business and delivering on the relevant strategic objectives that we discussed at Z’s Investor Day in July.”
The Z Energy shareholder vote is expected to take place early 2022.
For more information visit the Z Energy website.