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Proxy advisory firm Institutional Shareholder Services (ISS) has favored Brookfield Infrastructure Partners’ offer for Inter Pipeline Ltd in a blow to a rival bid from Pembina Pipeline Corp .

During the past week, Brookfield raised its hostile offer for Inter Pipeline to about $8.58-billion.

Before that, Pembina had made an all-stock bid of about $8.5-billion, while Brookfield had earlier offered $8.48-billion, with an all-cash option.

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“The combination with PPL carries execution risk and shareholders have also been offered a higher competing bid from BIP which has financing certainty, no regulatory risk, and an all-cash option, although there is a slight risk that BIP does not receive the requisite shares if the PPL transaction is voted down,” ISS said in a note over the weekend.

“Absent materially improved terms from PPL, shareholders appear to be better off at this time with the riskless option available through Brookfield’s tender,” ISS wrote in its note.

The Canadian pipeline operator has recommended that shareholders vote for the offer from Pembina. Inter Pipeline said Brookfield had not presented a formal revised offer and that shareholders need not take action yet.

The bidding war for Inter’s oil and gas pipelines, mainly in Western Canada, as well as storage facilities and processing plants, comes as North American oil futures have climbed, fueled by a recovery in travel demand from the early pandemic hit.

Brookfield said on Thursday shareholders can now elect to receive either $20.00 per share in cash or 0.25 of a share of Brookfield Infrastructure Corp.

The sweetened offer came a day after the Alberta Securities Commission ruled that Inter did not engage in any improper defensive tactics to fend off Brookfield’s hostile takeover bid.

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