Aussie regulator imposes condition on Brookfield's Neoen takeover

The Australian competition watchdog will not oppose to Brookfield Asset Management’s (TSE:BAM.PF.F) planned acquisition of Neoen SA (EPA:NEOEN) but will require the French company’s assets in Victoria to be divested in order to rule out competition concerns in the Aussie state.

The approval by the Australian Competition and Consumer Commission (ACCC) is subject to a court-enforceable undertaking related to Neoen’s wind, solar and energy storage assets and six development projects in Victoria. According to the regulator’s statement on Thursday, the proposed combination would increase Brookfield’s chances of prioritising its own generation and storage assets as it already holds a controlling interest in Ausnet, the electricity transmission network operator in Victoria.

“The ACCC considers that, without the divestment, the acquisition would have increased Brookfield’s incentives to delay or increase the cost of connections works on rival projects or operate the AusNet transmission network to benefit Brookfield’s related assets,” said ACCC Commissioner Philip Williams.

Brookfield, along with its renewables arm Brookfield Renewable and Singaporean state-owned conglomerate Temasek, proposed to acquire around 53.12% of the outstanding shares of Neoen at a price of EUR 39.85 per share. The block deal agreed in the summer values the French company at EUR 6.1 billion (USD 6.63bn).

Among Neoen’s operational assets in Victoria are the 300-MW/450-MWh Victoria Big Battery, the 128-MW Numurkah solar farm and the Bulgana wind and battery hub. In Australia altogether, the company owns roughly 1.8 GW of renewable power plants and has 48 projects under development.

(EUR 1.0 = USD 1.087)

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