Ashurst has advised Western Areas Limited in relation to the proposed ~$1.096 billion acquisition of Western Areas by IGO Limited, through its wholly-owned subsidiary, IGO Nickel Holdings, by way of a scheme of arrangement.
Western Areas, IGO and IGO Nickel have entered into a Scheme Implementation Deed (SID), pursuant to which it is proposed that IGO, through its wholly-owned subsidiary, IGO Nickel, will acquire 100% of the issued capital of Western Areas by way of a members' scheme of arrangement (Scheme).
If the Scheme is implemented, Western Areas shareholders will receive A$3.36 cash for each Western Areas share they hold, implying an equity value of Western Areas (on a fully diluted basis) of approximately A$1.096 billion.
The consideration represents:
- a 35.5% premium to Western Areas' undisturbed closing share price of A$2.48 per share on 18 August 2021 (the day prior to Western Areas announcing it was in preliminary discussions with IGO in relation to a potential change in control transaction);
- a 36.5% premium to Western Areas' 30-day VWAP prior to 18 August 2021 of A$2.46; and
- a 39.6% premium to Western Areas 90-day VWAP prior to 18 August 2021 of A$2.41.
Implementation of the Scheme is subject to a number of conditions precedent, including approval by the requisite majorities of Western Areas shareholders, approval of the Scheme by the Court and the Independent Expert concluding (and continuing the conclude) that the Scheme is in the best interest of Western Areas' shareholders.
The Western Areas Board has unanimously recommended that Western Areas shareholders vote in favour of the Scheme, and each director intends to vote all Western Areas Shares held or controlled by them in favour of the Scheme:
- In the absence of a Superior Proposal; and
- Subject to an independent expert concluding in the Independent Expert's Report (and continuing to conclude) that the Scheme is in the best interests of Western Areas shareholders.
Perpetual Limited ("Perpetual") (which currently owns 14.7% of the Western Areas shares) has confirmed to IGO that, if the Scheme proceeds, it intends to vote all of the shares in Western Areas that it holds (directly or indirectly) at the time of the Scheme meeting in favour of the scheme, in the absence of a superior proposal, and subject to a number of other qualifications.
Ashurst continues to advise Western Areas in relation to all aspects of the Scheme.
The matter was led by Corporate Transactions partners Roger Davies and Antonella Pacitti, with Roger commenting: "Western Areas is a longstanding client of the firm, with a relationship that stretches back over nearly 15 years. We are delighted to be advising them on this very significant transaction.
We have enjoyed working with Western Areas' dedicated and high quality board and management team in bringing the proposal to this stage. We now look forward to continuing that work to progress the Scheme to implementation and to delivery of the Scheme's benefits to Western Areas' shareholders."
The partners were assisted by senior associate Jacob Carmody, associates Tom Carmody and Cairo Leicester, and lawyer Daniel Lucanus.
