Gas Week

EWN Publishing

Babcock & Brown AlintaAGL stake exercise price of the option at $1.06 billion

Posted by gasweek on 9 October, 2007

AGL Energy said it would be interested in some or all of Queensland-based Enertrade’s business, as well as energy assets in NSW, should they be priva­tised by the NSW Government. But first it had to decide on its option over AlintaAGL. According to Nigel Wilson, in The Australian, (25/9/07 p. 22), Babcock & Brown Power, which had acquired the majority AlintaAGL stake as a result of the B&B/Singapore Power Inter­national takeover of Alinta, said it had set the exercise price of the option at $1.06 billion. This provides a total enterprise including $506 million in debt) value of $2.09 billion, valuing AGL Energy’s AlintaAGL stake at $522 million (plus $167 mil­lion) in debt.

Three months to exercise its option: Analysts said this was a good price — for AGL Energy, which has three months to exercise its option. BBP’s CEO, Paul Simshauser, said the potential acquisition of the remaining minority interest in AlintaAGL would “provide BBP with an outstanding base from which to develop a sizeable energy business with strong growth opportunities in the high-growth WA market.”

WA generation assets: The power plants at Alcoa’s Pinjarra and Wagerup alumina refineries (with 640MW capacity when all are operating next year) would increase BBP’s gas-fired generation portfolio, which in­cluded Port Hedland and New­man in WA, and further reduce BBP’s carbon footprint, he said. AGL Energy said it would advise the market when it noti­fied Alinta of its decision.

The Australian, 25/9/2007, p. 22

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