British petrol and convenience store chain EG Group is poised to gain access to Caltex Australia’s books.
It is understood EG should receive a formal response waving it through to the data room as early as Friday, after days of close negotiations between the two parties.
Caltex’s board, led by Steven Gregg, is due to meet to sign off on the due diligence access, sources said.
EG ramped up the $8.8 billion takeover battle for the fuels supplier last week with a non-binding offer that involved a mix of $3.9 billion in cash and shares in a fuels and infrastructure business that would be spun off in a listed company called Ampol.
EG, which was started by a pair of brothers from Bradford in England’s north, already owns Woolworths’ Australian petrol stations.
Its total value depends on the value placed on Ampol, making it hard to compare directly with the sweetened all-cash $8.8 billion offer from Canada’s Alimentation Couche-Tard, at $35.25 a share.
The Canadians are coming (back)
Already in the data room is Canada’s Couche-Tard, which was granted due diligence access at the start of last week after lobbing its third, and final, bid at Caltex.
Street Talk understands Couche-Tard’s management team – led by managing director Brian Hannasch – are expected to touch down in Australia next week to continue negotiations with Caltex’s top brass.
Hannasch and his team have got a serious headstart on rival suitors.
Couche-Tard raised its friendly offer earlier this month for the second time, having originally approached Caltex with a $32 a share proposal in October, before raising it to $34.50. Both those prices were rejected by Caltex’s board.
Caltex said on Tuesday underlying replacement cost operating profit for the full-year dropped to $344 million, from $558 million in 2018, just above the mid-point of Caltex’s guidance in December for between $320 million and $360 million.
The result was dragged down as expected by lower refinery earnings, tough competition and a soft broader market.
Shares in Caltex dipped 1 per cent to $33.72 on Thursday.
Extracted from AFR