According to Yahoo News, Origin Energy Ltd. has turned down a backup deal proposal from Brookfield Asset Management Ltd. to acquire its primary energy business. The company is expected to reject a full A$19 billion ($12.6 billion) takeover at a vote next week. Origin stated that an alternative offer by Brookfield and EIG Global Energy Partners, in which the Canada-based fund would pay A$12.3 billion for the target's energy generation and retailing business, is not in the best interests of Origin or its shareholders. The offer was described as 'incomplete, complex, and highly conditional.'
Investors are scheduled to vote on a full takeover by a Brookfield and EIG-led consortium on Monday. However, the deal is opposed by Origin's largest investor, AustralianSuper, which holds approximately 17% of the company – likely enough to block the transaction. AustralianSuper, the country's largest pension fund, has rejected Brookfield's offers as too low and argued that taking the firm private would prevent investors from gaining exposure to the energy transition.
Origin shares dropped as much as 3.3% in Sydney trading. Brookfield and EIG made a revised offer last week, just hours before a planned shareholder vote on the A$9.43 per share proposal, leading Origin to postpone the meeting to Dec. 4. Origin's board still unanimously recommends that proposal. If the full takeover is rejected, Origin will continue to execute its strategy and ambition to lead the energy transition in Australia, remaining open to strategic options that enhance shareholder value, according to the statement.