Origin chairman warns share price may fall if deal fails

afr.com:

Origin Energy chairman Scott Perkins has told shareholders that the board took into account the improved outlook for the business when agreeing to an $18.7 billion takeover offer from two North American suitors.

Mr Perkins’ comments to the annual shareholder meeting come after Origin shares last week surged past the offer price from Brookfield and EIG after the merger secured approval from the competition regulator.

Scott Perkins, Origin Energy chairman, at last year’s AGM. Sydney Morning Herald

Some institutional investors have called for the offer to be sweetened given the improvement in Origin’s performance and the market outlook since the deal was agreed.

Commenting on the 2024 outlook at the AGM, CEO Frank Calabria said it had “marginally improved” since the full-year results in August.

“Due to improved operational performance and market conditions, we are now expecting an uplift in the lower end of the energy markets underlying EBITDA guidance range,” he said.

“In integrated gas, our forecast was for Australia Pacific LNG production to rebound and cash flow to remain strong. We now expect a further improvement in Australia Pacific LNG production towards the top end of the guidance range provided.”

Origin shares closed on Tuesday at $9.30, 39¢ above the $8.91 a share level agreed by the parties in March. However, the price in March represented a premium of almost 50 per cent to Origin’s share price before the approval from the suitors was announced last November.

But the chairman cautioned the share price may fall if the deal does not proceed.

“Ultimately, the scheme requires shareholder approval to proceed, and the board will continue to work to facilitate that,” Mr Perkins said.

The board’s final recommendation