Is Bob Browning lining up for the WA Business News Deal of Year again?
Is Bob Browning lining up for the WA Business News Deal of Year again?
The Alinta Ltd chief has been a regular feature at the head of the list since it first reviewed the major corporate deals of 2003.
The seizure this week of more than 10 per cent of Australian Gas Light Company Ltd at $19.45 a share, forcing the east coast energy giant to the table for merger discussions, is an audacious move.
If the outcome is a success for Alinta, however, it’s likely to again put Mr Browning at the head of Western Australia’s transactions.
At almost $9 billion, AGL is more than three times the market capitalisation of Alinta, which is around $2.8 billion.
Alinta is planning to offer 1.773 of its shares for every AGL share in a bid that would derail AGL’s current demerger plan by offering the bigger company’s shareholders a projected $3.35 a share premium above the $16.10 per share valuation on the sum of the parts of the business.
However, Alinta goes further. It proposes its own demerger of the combined AGL/Alinta – to spin-off a utility assets business.
With a post-privatisation constitu-tional requirement for Alinta to be headquartered in Perth, at least some part of this demerged entity would most likely end up based in WA.
Whether or not Mr Browning would remain here after such a deal is a moot point. Heralding from US mid-west town of Kansas City, Mr Browning confirmed that he planned to sit atop the merged entity – having a team that is well honed in mergers and demergers already – but was unable to offer much advice on who would go where once an AGL/Alinta break-up occurred.
It’s certainly enough to get the mouths watering for any corporate advisers, Macquarie Bank in this instance.
But Mr Browning has kept the corporate sector busy for years.
In 2003, Alinta headed the inaugural WA Business News Deal of the Year with what was known as the Aquila transaction, whereby it bought out the other Australian subsidiary (United Energy) of its former major shareholder US-based Aquila.
The deal was stitched up as an exit strategy for Aquila and surprised the market because most believed Alinta would have been a natural target for United.
A year later later, Mr Browning and his crew at Alinta were at it again.
This time they led a consortium known as DUET in a successful $1.86 billion bid for the Dampier-to-Bunbury natural gas pipeline, a deal which again won them Deal of the Year. In the minds of the market that deal topped the $1.69 billion acquisition of Duke Energy with a host of mainly east coast assets that transformed Alinta into a truly national player.
Last year, again, Alinta was a headline act in the local corporate sphere.
While missing out on the Deal of the Year title for the third year running, Alinta’s $950 million spin-off of Alinta Infrastucture Holdings Ltd was viewed as a terrific move during a year of monumental transactions.
