Australian fuel company Ampol has sold its Gull business in New Zealand to Aussie investment company Allegro Funds for $572 million. Ampol's application to the NZ Commerce Commission (NZCC) to buy Z Energy was subject to it divesting Gull.
Last month, Ampol advised that it had backed away from divesting Gull in the form of an initial public offer. Today’s transaction is subject to NZCC approving Allegro as the purchaser of Gull, Overseas Investment Office (OIO) approval and Ampol successfully completing the acquisition of Z Energy.
The company's acquisition of NZX-listed Z Energy is still subject to NZCC clearance, OIO approval and the Z Energy shareholder vote.
"The sale of Gull is an important step in for the clearance of the Ampol and Z Energy scheme of arrangement," Z Energy said.
The takeover vote will go to Z Energy shareholders at a meeting set for March 25.
Under its terms, Allegro will acquire 100 percent of Gull for net cash proceeds of about $509m as well as the assumption by Allegro of $63m of leases and debt-like items. Under the arrangement, Ampol has committed to a five-year fuel supply agreement with Gull as requested by Allegro, subject to annual price reviews and termination rights. In addition, the transaction will be subject to Ampol successfully completing the acquisition of Z Energy.
Ampol said its plan to buy Z Energy was on track to be completed in the first half of this year. ASX-listed Ampol intends to use the proceeds of the sale of Gull towards funding the proposed acquisition of Z Energy.
Gull has operated in New Zealand since 1998 and has about 8 percent market share.