APA Group readies Pilbara power buy, results day raising
Gas pipelines owner APA Group is set to make its biggest investment in electricity generation and battery storage assets, advancing its transformation into a broader Australian energy infrastructure group.
APA Group is set to acquire Alinta Energy’s up-for-sale Pilbara portfolio, which includes the Port Hedland and Newman power stations, the Chichester solar farm and Goldfields gas transmission pipeline, in a deal worth about $1.5 billion.
Both sides were preparing to seal terms late on Tuesday. It is slated to be announced on Wednesday morning, in time for the listed APA Group’s 2023 financial results.
Adam Watson will hand down his first results as APA Group boss. Wayne Taylor
APA Group is expected to ask shareholders to help fund the bid via an equity raising.
While the infrastructure owner had $1.6 billion in undrawn debt facilities at December 31, it also had a $1.4 billion-plus pipeline of near-term organic growth opportunities; tapping equity markets should enable it to do both.
An APA Group spokesman declined to comment on Tuesday night.
The acquisition is a big move for APA Group, which is keen to expand in the Pilbara region and has been trying to add more electricity generation and transmission assets to its portfolio to help shore-up its long-term future.
APA Group’s strategy is to be the infrastructure partner of choice for the energy transition, and wants to be involved across contracted renewables and firming, electricity transmission, gas transport and future energy technologies. Alinta Energy’s Pilbara portfolio ticks three of those boxes, and is also about servicing the resources sector and big resources clients which APA Group knows well.
APA Group has turned to M&A to expand beyond its gas pipeline
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