Canadian asset manager Brookfield and Australian billionaire Mike Cannon-Brookes have teamed up on a joint bid for AGL Energy, and propose shutting the company’s coal-fired power stations earlier than planned.
It is understood the pair submitted a non-binding and indicative offer over the weekend and it is being considered by AGL Energy’s board.
The bid values AGL Energy at about $8 billion, including debt, or $7.50 a share, which was a 4.7 per cent premium to AGL Energy shares’ last close and a 20 per cent premium to its 30 day average traded price.
AGL’s board is due to meet on Sunday afternoon.
The pair is believed to be keen to acquire AGL Energy in full – including its retail operations and power generation – ahead of the company’s plans to split in two.
AGL Energy and Brookfield declined to comment on Sunday.
Brookfield and Cannon-Brookes are understood to be keen to accelerate AGL Energy’s plans to exit coal-fired power, and invest in more renewable energy generation projects and infrastructure.
AGL Australia – the entity that would own the company’s coal fired power stations following the proposed split – is targeted towards being a net zero energy business by 2047.
The consortium wants to see that happen at least 10 years earlier.
Brookfield’s interest is not surprising. It is one of the world’s largest investors in renewable power, an active player in Australia’s energy infrastructure market and spearheaded an $18 billion bid for Victoria’s electricity and gas distributor AusNet last year.
Cannon-Brookes has emerged as a loud voice in Australia’s energy sector, including pledging $1.5 billion of their personal wealth by 2030 to ventures aimed at cutting carbon emissions.