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    Origin rejects revised bid from Brookfield-led consortium


The company said that the offer does not provide sufficient certainty or value for its shareholders.

by: Shardul Sharma

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Natural Gas & LNG News, Asia/Oceania, Liquefied Natural Gas (LNG), Security of Supply, Corporate, News By Country, Australia

Origin rejects revised bid from Brookfield-led consortium

Australia’s Origin Energy announced on November 30 that it has rejected the revised offer from a Brookfield-led consortium, stating that it does not provide sufficient certainty or value for its shareholders.

In a statement released to the Australian Securities Exchange, Origin Energy outlined its reasons for rejecting the revised offer, stating that it was “incomplete, complex, highly conditional, and did not provide sufficient certainty for Origin shareholders.”

The company also stated that its board believes that the value of the revised offer does not adequately compensate shareholders, especially considering the extended timeline that the proposal would require.

Origin Energy had previously been forced to delay a vote on the original bid due to the consortium’s last-minute revised offer on November 22. The company has now advised its shareholders to vote in favour of the consortium’s previous offer at a meeting scheduled for December 4 in Sydney.

The Brookfield-led consortium is seeking to acquire Origin Energy’s energy markets business, while MidOcean, a unit of EIG, would acquire the integrated gas business, including a 27.5% interest in Queensland-based Australia Pacific LNG (APLNG). APLNG is the largest producer of coalbed methane in Australia, supplying gas to Queensland’s domestic gas market and processing CBM into LNG for exports.

The consortium has offered A$6.59 and A$1.86 in cash and a A$0.39 special dividend per Origin share. The revised offer was at the same price but would allow institutional investors to remain invested in Origin's energy markets business that would be owned by Brookfield.

Under the revised proposal, institutional shareholders would have the opportunity to reinvest in Brookfield’s energy markets business following the deal’s completion. Additionally, if the deal is rejected, an alternative transaction option has been proposed, involving the sale of Origin Energy’s energy markets business to Brookfield for A$12.3bn, followed by an off-market takeover offer by EIG for the LNG business, subject to a minimum acceptance condition of 50.1%.

In the case of the alternative transaction proceeds, shareholders would receive a total cash consideration of approximately $9.082/Origin share.

AustralianSuper, Origin Energy's largest shareholder, has repeatedly stated its intention to vote against the takeover bid.