August 17, 2015 / 3:50 AM / 3 years ago

CORRECTED-Australia's Asciano halts trading, media report says to recommend $6.5 bln Brookfield offer

(Corrects headline, first paragraph and bullet point to show that only one media report referred to Asciano recommendation, not multiple reports; also changes dateline to Aug 17)

* Asciano says halt related to “announcement”

* Media report says company to recommend Brookfield takeover deal

* Company to report annual results

By Byron Kaye

SYDNEY, Aug 17 (Reuters) - Asciano Ltd requested a trading halt on Monday after a media report said the Australian rail freight firm would recommend shareholders approve a $6.5 billion takeover offer from Canada’s Brookfield Asset Management when it reports annual results on Tuesday.

In a filing to the Australian Securities Exchange, Asciano said it requested the halt because it “expects to make an announcement to the ASX shortly in relation to recent media speculation.”

The company gave no details, but a day earlier Fairfax Media said Brookfield’s due diligence had “gone well” and “Asciano investors are waiting now on a formal bid” following an informal approach in June.

A Brookfield spokeswoman declined comment.

The deal, which would be the seventh largest buyout of an Australian firm by an overseas entity, would underscore the huge international appetite for Australia infrastructure. Record low interest rates have added to the M&A appeal of a sector already struggling with lower valuations because of a downturn in coal exports.

Asciano shares have traded at a discount to Brookfield’s indicative offer price since the target disclosed the approach on July 1, as investors question whether the Australian firm will submit to a takeover just as it starts to benefit from a A$3 billion ($2.21 billion) equipment overhaul.

The stock last traded on Friday at A$8.11, an 11 percent discount to Brookfield’s A$9.10 indicative bid.

Asciano is expected to post a net profit of A$392 million for the year to June 30 on Tuesday, according to the average forecast of 16 analysts polled by Thomson Reuters Starmine, its highest since being spun off by Toll Holdings in 2007.

Earlier this year, Asciano’s former parent company, Toll Holdings, agreed to a A$6.5 billion takeover by Japan Post Holdings Co Ltd IPO-JAPP.T.

$1 = 1.3581 Australian dollars Reporting by Byron Kaye; Editing by Miral Fahmy

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