AGL to buy out Loy Yang
AGL Energy Limited has entered into conditional agreements to increase its ownership interest in Victoria's biggest power plant, the Loy Yang A power station, and the adjacent coal mine, from 32.54 per cent to 100 per cent for a total cost of $448 million. The deal values GEAC at $3.1 billion, including its debt of $2.1 billion.
The transaction will proceed by way of acquisition of the remaining shares in, and loan notes issued by, Great Energy Alliance Corporation Pty Limited (GEAC). GEAC is the owner of the 2,200MW Loy Yang A power station and a brown coal mine which supplies all the coal required to meet the current and future operating requirements of the power station.
The transaction is expected to complete in mid-2012 and is conditional on:
- ACCC approval and removal of current Federal Court undertakings which limit AGL’s ownership of GEAC to a maximum of 35 per cent; and
- GEAC having received, or having an enforceable right to receive, the first carbon assistance payment from the Federal Government.