ASX Renewable Energy Stocks: Tech billionaire Cannon-Brookes wants AGL to hold fire on demerger plans
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AGL Energy (ASX:AGL) today announced a partnership with Global Infrastructure Partners to develop a 2.7GW pipeline of renewable and low-carbon firming assets, right after tech billionaire Mike Cannon-Brookes secured an 11.28% stake in AGL as a means to stop its proposed demerger.
Global Infrastructure Partners has acquired a 49% stake in the Energy Transition Investment Partnership (ETIP) and will jointly fund $2bn of equity to support the development of these renewable energy projects, with the remaining funding requirements to be financed by debt on a project-by-project basis.
AGL’s proposed wind farm at Bowmans Creek (up to 450 MW) in New South Wales and the Loy Yang battery (200 MW) in Victoria will be the first two projects developed by ETIP, with the final investment decision for both projects proposed for the end of 2022.
Global Infrastructure Partners – one of the largest renewable energy investors globally – will acquire 49% of the development pipeline for $94 million, which includes an up-front cash payment of $40 million to Accel, AGL’s proposed spun-out power business.
Accel comprises AGL’s coal power plants assets such as the Liddell Power Station (closure set for April 2023), Bayswater Power Station (closure set for 2030 – 2033), and Loy Yang A Power Station (closure targeted for 2040 – 2045).
In an ASX announcement this morning AGL said it remains “committed to progressing the proposed demerger with a view to achieving implementation by June 30 and a responsible transition to Australia’s energy system”.
Grok Ventures, an entity associated with Mike Cannon-Brookes, wrote a letter to AGL stating that it intends to vote against AGL’s proposed demerger.
We will be voting against the upcoming, flawed demerger.
— Mike Cannon-Brookes 👨🏼💻🧢🇦🇺 (@mcannonbrookes) May 2, 2022
“We believe the Board’s plan to split AGL into two companies would deliver a terrible outcome for shareholders, customers, Australian taxpayers and the planet,” he says.
“Decarbonisation is one of Australia’s biggest economic opportunities and a vital challenge the world needs to solve. This is why we are now AGL’s largest shareholder. We’re calling on fellow shareholders to vote AGAINST the demerger, and for the people of Australia to support a brighter future.”
AGL said it continues to believe that the proposed demerger is in the best interest of AGL shareholders because it “creates the potential to maximise growth in the value of shares by giving each company the freedom to pursue individual strategies and growth initiatives; supports shareholder returns through distinct dividend policies and capital structures; and leaves the future value of two ASX listed companies with shareholders”.