Buy Out of the Fossils?

Atlassian co-founder and progressive billionaire, Mike Cannon-Brookes, and Canadian asset giant Brookfield on the weekend looked to a splurge a considerable $8 billion in a strategic takeover offer for what is currently Australia’s biggest greenhouse-gas polluter, AGL Energy.

The take-over would have seen the new owners bring forward the company’s exit from carbon-based fossil fuels by 15 years. The existing, 1970s-era coal plants in New South Wales and Victoria would have been shut once and for all by 2030, to be replaced via a $20 billion budget for construction of new wind farms and big batteries.

Despite best lobbying efforts, AGL Energy knocked back the bid on Monday, insisting the offer was far too low and had “undervalued the company,” suggesting that deal “wouldn’t be in the best interest of shareholders.”

The proposed step forward has been criticised by Prime Minister Scott Morrison. The LNP leader claimed on Monday, “We need to ensure that our coal-fired generation of electricity runs to its life because if it doesn’t, electricity prices go up.”

Cannon-Brookes debunked Morrison’s claim, saying that the change-over from coal-fired power will lead to cheaper energy. “Let’s face it – those coal plants aren’t exactly winning awards for reliability. We’re trying to do this to provide lower power prices to the customers of AGL.”

Image courtesy of @weista via Unsplash.

While “disappointing,” Cannon-Brookes is not discouraged by the response from AGL and is determined to move forward with the deal. “We think our bid has significant value for shareholders,” Cannon-Brookes told Radio National, “And is a far better option than the alternate path which is the demerger on the table, from the point of view of risk and the point of view of shareholder value.”

He also told Radio National, “Decarbonisation is the greatest economic opportunity facing Australia, but it requires vision and action.”

With those opportunities in mind, Cannon-Brookes has been linked with the $20 billion Sun Cable project to build 10GW of solar-power generation in the Northern Territory and sell it via a 4,000km undersea cable to Southeast Asia via Singapore. In the lead-up to last year’s UN climate conference, he also pledged $500 million to support NGOs working on climate-change mitigation.

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