Australian electricity company Tilt Renewables Pty Ltd said Monday that it has agreed to a $2.1 billion takeover deal.
The company said it will be acquired by a consortium which includes its second-largest shareholder AGL Energy Ltd.
The transaction is expected to be the first big acquisition in Australia and New Zealand this year. Companies and investors in the region are pushing for de-carbonization and a shift toward clean and renewable energy.
Powering Australian Renewables - a joint venture between AGL, QIC and Australia's sovereign wealth fund - will be taking over Tilt Renewables' Australia business. Mercury NZ Ltd., which holds a 19.9% stake in the company, will be taking over its New Zealand Business - including all of its wind farms in the region.
"The board is pleased that, with these new owners, the transition to renewables in Australia and New Zealand will continue to accelerate," Tilt Renewables' chairperson Bruce Harker said in a statement.
New Zealand's Infratil Ltd., which owns 65% of Tilt Renewables, will be selling its entire stake. The company expected gross proceeds of approximately $1.4 billion from the sale. Infratil more than doubled its stake in Tilt Renewables since it mentioned last year it would be reviewing its holdings in the company.
Tilt Renewables' share price jumped by 18.1% on the news. The stock ended Monday at NZ$7.61 per share, slightly lower than the consortium's offer price of NZ$7.80 - already a 20.4% premium to the company's stock price as of last week's closing.
Tilt Renewables said shareholders will meet to finalize the deal in about four months. Mercury NZ said it will be reflecting the deal in its 2022 earnings. AGL said it will inject additional funds of around $264.5 million to enhance its portion of Tilt Renewables' Australian operations.
"The proposed acquisition by PowAR will provide more renewable energy options in AGL's generation portfolio, further supporting our orderly transition away from coal-fired power and responding to our customers' increasing appetite for cleaner energy," AGL's chief executive officer, Brett Redman, said.
