Brookfield's $2.53 billion bid for Reliance Worldwide clears 'go shop' hurdle

By Reuters News

Oct 19 (Reuters) - Reliance Worldwide RWC.AX said on Monday that no rival bidder emerged during the "go shop" process under Brookfield's BN.TO proposed acquisition of the Australian firm, prompting the board to reaffirm its unanimous recommendation for shareholders to back the deal.

Here are some more details:

  • The plumbing supplies firm agreed in September to a scheme implementation deed under which Brookfield Capital Partners and its affiliates would acquire all of Reliance Worldwide's shares for US$3.38 apiece in cash, valuing the firm at $2.53 billion.

  • The offer implied a value of about A$4.87 per share based on the prevailing exchange rate on October 16.

  • Investors can choose to be paid in US dollars or Australian dollars if the deal proceeds and is approved by shareholders, Reliance said last month.

  • The companies had agreed to a "go shop" provision, unusual in Australian deals, that allowed Reliance Worldwide to seek rival bids, share due diligence materials and negotiate terms.

  • "Whilst there was extensive engagement with potential buyers during the 'Go Shop' process, no proposal was received," Reliance said in its statement.

  • After that period, customary no-shop, no-talk and no-due-diligence restrictions under the scheme implementation deed have come into effect.

  • The board again recommended that shareholders vote in favour of the scheme, in the absence of a superior proposal.

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