Brookfield warns: Origin shares at risk if bid fails

The market is betting against Brookfield/EIG getting their way, with Origin’s shares closing at just $8.65 – a significant discount to the bid price.

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Marc Stanghieri, head of M&A and activism at Morrow Sodali – which is being used by the bidders for their campaign – said retail shareholder engagement typically lifts when there is corporate activity like this.

“In the case of the upcoming Origin scheme meeting, we are observing a very engaged retail shareholder base, and we expect to continue to see a very strong uplift in shareholder votes as we head towards the proxy voting deadline on November 21,” he said.

AustralianSuper has made it clear it will not change its mind on the deal. While the super fund giant has not offered its own valuation, market speculation has suggested $12 a share would be closer to the mark.

“The offer from the consortium remains substantially below our estimate of Origin’s long-term value,” it said last week after lifting its stake above 15 per cent.

”AustralianSuper believes the ongoing energy transition, as we move towards net zero by 2050, has further enhanced the value of strategic energy transition platforms such as Origin, whether public or private.”

All eyes will be on AustralianSuper this week to see if it acquires more shares to further scuttle the Brookfield/EIG bid. The super fund could lift its stake in Origin to 19.9 per cent before it would be forced to launch a takeover.

If the bid fails, Brookfield/EIG have floated a plan B that involves an off-market takeover bid at a lower price, which will deliver more than 50 per cent ownership and control of Origin to the consortium.

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