AusSuper rejects sweetened bid for Origin

afr.com:

AustralianSuper, the biggest shareholder in Origin Energy, has swiftly rejected an increased takeover offer for the country’s largest energy utility, leaving the near-$20 billion deal hanging in the balance.

North America’s Brookfield and EIG raised their offer for Origin by 8 per cent to $9.53 a share, and declared it “final” under the scheme deal. Shares in Origin fell 4.2 per cent to $8.69, as some investors bet on the deal collapsing.

Origin Energy’s new offer values it at more than $20 billion.  Louie Douvis

AusSuper, which owns almost 14 per cent of Origin, said it intends to vote against the deal, which requires 75 per cent support from voting shareholders.

“The offer from the consortium remains substantially below our estimate of Origin’s long-term value,” the industry super fund said. “AustralianSuper believes Origin has a highly strategic portfolio of assets to participate in, and benefit from, the energy transition.”

But other institutional shareholders indicated they were now either prepared to accept or were seriously considering the revised offer.

Suhas Nayak, a portfolio manager at longstanding shareholder Allan Gray, said it would vote in favour of the deal at the shareholder meeting on November 23, unless a higher one emerged.

“We are pleased to see the increase,” Mr Nayak said. “We think it strikes a fair balance between the risks and opportunities now, and we are happy to vote in favour, in the absence of a competing offer.”

VanEck portfolio manager Jamie Hannah said the firm was “certainly going to consider the new price” but was not a definite ‘yes’. “Brookfield was put in a position where they had to increase their offer… the market had called for it,” Mr Hannah said.

“We’ve got to run it through