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Strong field makes it to first base in $12 bln Australian energy sale

Published 27/08/2015, 06:19 pm
© Reuters.  Strong field makes it to first base in $12 bln Australian energy sale
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By Byron Kaye

SYDNEY, Aug 27 (Reuters) - A half dozen groups of companies from four continents placed indicative bids by a Thursday deadline for an electricity transmitter in Australia's most populous state, a source told Reuters, a milestone in a record $12 billion privatisation sale.

The high number of bidders suggests appetite for Australian infrastructure with regulated and predictable revenue has been unaffected, perhaps even helped, by roiling global equity and commodities markets which have sent company profits and shares plummeting.

New South Wales government-owned TransGrid, which runs 12,000 km (7,500 miles) of transmission lines from one side of the state of 7.5 million people to another, meanwhile has its earnings secured by a national energy regulator which approves its fees five years in advance.

"A strong field of parties have lodged indicative bids for the long-term lease of TransGrid," NSW Treasurer Gladys Berejiklian said in an email statement without saying how many parties bid and without identifying any bidders.

TransGrid is one of three assets expected to fetch a total A$17 billion in the sale.

A source with direct knowledge of the process told Reuters that five consortia bid and that the status of a sixth, including another electricity company, Ausnet Services Ltd AST.AX , Singapore Power and government-owned State Grid Corp of China was uncertain.

An Ausnet spokesman confirmed the company had previously lodged a formal expression of interest but declined comment further.

Other bidders included Australia's IFM Investors, an investment fund owned by 30 pension funds, with Queensland state-owned investment fund QIC, the source said.

Another consortium to bid was Australia's Hastings Funds Management, Australian electricity firm Spark Infrastructure SPK.AX , sovereign fund Abu Dhabi Investment Authority and Kuwait's Wren House Infrastructure, with Canadian pension fund investor Caisse de depot et placement du Quebec, the source said.

A fourth bidder was Canadian pension fund investor Borealis, the Canada Pension Plan Investment Board and AustralianSuper Pty Ltd, the source said.

Infrastructure fund Global Infrastructure Partners and China Southern Power Grid Co Ltd joined up for a bid and Hong Kong's Cheung Kong Infrastructure Holdings Ltd 1038.HK bid solo, the source added.

State treasurer Berejiklian did not say when she would make a shortlist of preferred bidders, but said the government "will now move to shortlist qualified parties for the lodgement of binding bids which will be due in the coming months".

Investment bank UBS AG UBSN.S , which Berejiklian hired to run the sale, along with Deutsche Bank (XETRA:DBKGn), was not immediately available for comment. ($1 = 1.4006 Australian dollars)

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