Iberdrola set to take full control of Infigen, another window on energy market closes

Spanish energy giant Iberdrola is set to win full control of Australian renewable energy company Infigen Energy, after rival bidder UPC/AC confirmed this week that it had sold its 20 per cent stake.

The transaction ends a three-month bidding war, and means that Iberdrola will be able to move to compulsorily acquire the small amount of shares not yet sold into the bid, and take the company private, absorbing it into its huge and rapidly expanding global renewables division.

UPC/AC will walk away with a handsome profit from its venture, although the scale of those gains may be clouded by the complex share swap agreement it entered into to buy its stake, but it may provide some capital to move forward on its other projects in Australia, including the Robbins Island wind farm in Tasmania, and pumped hydro projects in South Australia and NSW.

The victory by Iberdrola also means the presence in Australia of another international player with serious financial grunt and big ambitions.

It is already committed to building the country’s biggest hybrid wind and solar project near Port August in South Australia, and now will own the Lake Bonney wind farm, the Lake Boney battery, and the Alinta, Capital, Woodlawn and Bodangora wind farms, fast-start generators in NSW and South Australia and a large pipeline of future developments.

But the likely delisting of Infigen and removal from the Australian Stock Exchange boards  after the bid formally closes on September 23 also closes one of the few windows into Australia’s notoriously opaque energy markets.

Infigen, like other listed companies, is required to present regular updates on production, performance and profits. It offered monthly and quarterly production data and commentary that offered rare insight into an industry obsessed with confidential transactions, and were even the result of large auctions are kept hidden from the public (with the exception of the ACT).

The departure of Infigen from public oversight follows the delisting of Windlab, taken private by a consortium led by Andrew Forrest’s Suadron Energy, and the withdrawal of other listed companies such as Downer and Decmil from the lead contracting business. You often had to go digging into the accounts to find the goodies, but it did give rare insight into the industry.

The number of listed companies in the renewables sector is dwindling – largely reduced to Tilt, Genex, and smaller technology developers such as Carnegie and 1414, a handful of contractors with interests in renewables, and some international investors such as Neoen, along with global giants like Iberdrola, Enel and Total for whom Australia is but a dot on the map.