BROOKFIELD Infrastructure's minority stake in Asciano is no barrier to a successful takeover by rival suitor Qube, waterfront warrior Chris Corrigan has said in his first public comments since a Qube-led consortium made a provisional $9 billion takeover proposal for the ports and rail group.
Mr Corrigan, Qube's chairman, said it was unlikely Brookfield would stick around if the consortium's bid succeeded.
"I'd be surprised if they wanted to hold a minority stake in a business that was run by us," he said after Qube's annual meeting in Sydney on Tuesday.
Asked whether he thought Brookfield would cut a deal with Qube despite the Canadian infrastructure group telling investors in early November it would not support a break-up of Asciano and was prepared to hold its 19.99 per cent stake over the long term, Mr Corrigan said: "Yes, I think they would."
Mr Corrigan said he did not believe Brookfield could use its stake in Asciano to block a sale of Patrick's ports to Qube, adding that the consortium also believed it could split up Asciano without Brookfield's agreement.
Asciano's board has recommended investors accept a formal $9 billion cash-and-scrip takeover bid from Brookfield.
Asked whether he thought Asciano's board favoured Brookfield's bid over Qube's indicative offer, Mr Corrigan said: "We seemed to have spoiled their party. But at the end of the day, they've now given us access to the data room and so we have to take their interest in looking after their shareholders at face value."
The Qube consortium began due diligence on Asciano on Friday, with the aim of making a formal takeover bid for the company in mid-December. It plans to meet Asciano management this week and make site visits.
Qube could continue to hold its 19.99 per cent stake in Asciano "indefinitely", Mr Corrigan said. "That's not a financial burden for us."
Qube wants to combine Asciano's ports operations with its logistics businesses. Qube's consortium partners - the Canada Pension Plan Investment Board and Global Infrastructure Partners - want to acquire Asciano's Pacific National rail operations.
Mr Corrigan said Qube had no interest in Pacific National because it was "a totally different" business to Qube's existing rail operations, which consist of rail links to and from ports.
Qube did not believe it needed to raise its indicative bid to win over Asciano shareholders but had not ruled out a potential increase, Mr Corrigan said.
Qube approached Asciano with a proposal to buy Patrick ports before Brookfield made a takeover proposal for the entire company in June. Qube held meetings with Asciano chairman Malcolm Broomhead and chief executive John Mullen, Mr Corrigan said.
"Our proposal then was to take the Patrick terminals in a cash transaction and they were certainly interested in that up until the point when the total solution arrived in the Brookfield bid." Brookfield's formal scheme of arrangement proposal in August forced Qube to respond, he said.
"With the possibility of Patrick terminals changing hands for a considerable period of time we thought we should at least put our oar in the water and see if we can get into the action."
He acknowledged that with hindsight Qube had been slow to make a formal bid for Patrick ports, but said at the time of its initial talks it wasn't clear that Asciano was prepared to sell its entire business.
Asciano had also held talks with Chinese conglomerate China Merchants over a possible joint venture.
Qube believed it could do "a lot more" with Patrick ports than Brookfield, Mr Corrigan said.
"Their primary interest is having an asset that produces income," he said. "Our primary interest is changing the way the transport chain works."
Any takeover of Patrick ports by Qube could be "transformational" for import and export supply chains in Australia by creating a more efficient logistics system, he said.
Qube chief executive Maurice James said the consortium had made a submission to the Australian Competition and Consumer Commission and did not believe there were any "material competition issues" with its proposal. The ACCC expects to rule on Brookfield's proposal by December 17.
Asciano shareholders will receive Brookfield's bidder's statement about December 4 and Asciano will dispatch a target's statement about the same time.
The Qube consortium made a provisional takeover proposal for Asciano worth $9.25 a share for the ports and rail group on November 9.
