AGL Energy reports it has ceased undertaking due diligence on Vocus Group. AGL has also decided to withdraw its non-binding, indicative proposal to acquire Vocus. According to AGL CEO Brett Redman, AGL is now exploring investment opportunities across three focus areas: optimising its existing portfolio for performance and value; evolving and expanding its core energy markets offerings; and creating new opportunities with connected customers.
AGL sees material opportunities as energy and data value streams continue to converge and the traditional energy sector accelerates its transformation. The approach to Vocus reflected AGL’s view that the Vocus asset base has attributes that could support the execution of this strategy and benefit our customers. “However, we are no longer confident that an acquisition of Vocus at the proposed terms would represent sufficient certainty of creating value for AGL shareholders”, AGL said.
AGL Energy had received exclusive access to conduct due diligence on Vocus Group for a period of four weeks after submitting an offer to acquire Vocus at AUD 4.85 per share. AGL initially announced that it considered making a takeover offer for Australian operator Vocus at the beginning of June. However, the non-binding offer was withdrawn after the companies could not reach agreement on the terms for conducting due diligence. On 11 June, AGL returned with a non-binding and indicative proposal to acquire Vocus for AUD 4.85 per share. AGL’s new offer was lower than EQT Infrastructure’s buyout proposal of AUD 5.25 per share in cash.
On 5 June, Vocus terminated discussions with EQT Infrastructure in relation to its buyout proposal. On 27 May, Vocus received an offer from EQT to acquire all of the shares in Vocus at a price of AUD 5.25 per share in cash. Following an accelerated period of due diligence, EQT decided not to proceed with the transaction outlined in the indicative proposal.
Vocus announced at its interim FY19 results that it intended to conduct a strategy update for investors. This is scheduled for 3 July. Vocus has also reiterated its FY19 guidance as stated on 27 February. The company expects its underlying EBITDA to range between AUD 350 million and AUD 370 million.
