Macquarie-led group buys Australia's Endeavour Energy for A$7.62b

The Macquarie-backed consortium purchased a 50.4 per cent stake.
The Macquarie-backed consortium purchased a 50.4 per cent stake.PHOTO: REUTERS

SYDNEY (REUTERS) - The Australian state of New South Wales said on Thursday (May 11) that it has sold power grid Endeavour Energy to a consortium led by Macquarie Group, Australia's biggest investment bank, for A$7.62 billion (S$7.9 billion).

The price was a premium to Endeavour's total regulated asset base of A$6.2 billion.

The Macquarie-backed consortium purchased a 50.4 per cent stake but was also responsible for refinancing all of the company's debt, said a source involved in the transaction who was not authorised to speak publicly about the matter.

Australian governments are selling assets to fund roads and public transport as the population grows, especially around the country's biggest city and NSW capital of Sydney.

Macquarie's partners include Canada's British Columbia Investment Management, Australia's AMP Capital and Qatar Investment Authority. The Macquarie-led group beat a rival consortium led by Hastings Funds Management.

It is the last of three power grid sales by NSW state, following the A$16.2 billion sale of Ausgrid in October to a consortium of Australian pension funds, and that of TransGrid to an international consortium of funds for A$10.26 billion in November 2015.

The Australian government in December advised potential bidders that no single foreign investor could own more than half of the stake in Endeavour being sold, while a domestic investor must hold at least 20 per cent.

The privatisation drive comes at a time when foreign investment in sensitive assets like power grids and ports is facing increased scrutiny on national security grounds.