Brookfield Infrastructure Upgraded At Credit Suisse On 'Robust' M&A Pipeline

In a report published Tuesday, Credit Suisse analyst Andrew M. Kuske upgraded the rating on

from Neutral to Outperform, while raising the price target from $46 to $52, following the announcement of the M&A deal with

. The company has a "robust" M&A pipeline. . "[W]e foresee distribution growth from a successful BIP deal for AIO that could generate more than US$5/unit of incremental value," analyst Kuske stated, while adding that there were some aspects of the potential deal that could be cause for concern. Asciano has confirmed the receipt of "a confidential, indicative, nonbinding and conditional proposal" from Brookfield Infrastructure for A$9.05/share in cash and share. However, a formal offer from the latter company is still awaited. The analyst believes that if the deal materializes, it could leader to a DPU increase, which in turn would better position Brookfield Infrastructure to tackle other aspects of its M&A pipeline. "The Brookfield Group continues to be positioned with many M&A opportunities and we view BIP facing transformational potential transactions in Brazil," the Credit Suisse report added. The analyst believes that the company's core asset base has the potential to drive meaningful growth.