June 12, 2020 / 8:19 PM / 20 days ago

Knight Vinke urges Alpiq investors to block squeezeout, threatens lawsuit

BOSTON (Reuters) - Activist investment firm Knight Vinke Asset Management on Friday appealed to investors in Swiss energy company Alpiq to block a planned squeezeout transaction which it calls too cheap and threatened to challenge it in court if it passes.

“Should Resolution 9 pass, as is likely, it is our firm intention to challenge the (70 Swiss francs) per share squeezeout valuation in court,” Eric Knight wrote to shareholders in a letter seen by Reuters.

Oxera Consulting, a firm commissioned by Knight, found errors in the method used to set a value for Alpiq.

“Correcting these errors would result in PwC’s valuation of Alpiq increasing by 50-75%, thereby supporting our view that CSA’s proposed squeeze-out price massively undervalues the Company,” the letter said.

A representative for Alpiq did not immediately respond to a request for comment.

Knight has long criticized plans by Alpiq’s controlling investors to acquire the 10% stake they do not yet own, noting outsiders would be deprived of participating in the company’s future gains. Besides Knight Vinke, index fund Vanguard and U.S. pension fund California Public Employees Retirement System, known as Calpers, also own stakes.

Roughly a year ago the Credit Suisse-managed CSA Energy Infrastructure Switzerland fund announced a takeover bid, offering shareholders 70 Swiss francs for each Alpiq share.

Alpiq’s shares were delisted late last year from the SIX Swiss Exchange as part of the takeover bid.

Shareholders will have an opportunity to vote at the annual meeting on June 24.

Reporting by Svea Herbst-Bayliss

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