Alinta Energy’s Hong Kong owner Chow Tai Fook looking for $4bn

The Braemar gas-fired power station in Queensland is one of Alinta’s assets.

Chow Tai Fook is believed to be looking at a break-up of Alinta Energy as part of its plans to exit its investment.

DataRoom reported on Sunday that Alinta is believed to be considering options for a sale.

Sources say the Hong Kong owner is looking for a price that values the business at about $4bn and that Goldman Sachs and Lazard Australia are the advisers.

One of the logical acquirers of at least some of its assets is Australian-listed gas pipeline owner APA, which last year missed out on the listed electricity transmission and distribution business AusNet.

The suggestion is that APA could be interested in Alinta’s West Australian assets that are not related to energy retailing.

APA is known to have sized up some of Alinta’s West Australian assets in the past.

Alinta’s power generation assets include the Wagerup, Pinjarra, Newman and Port Hedland gas-fired stations and Goldfields gas pipeline in WA.

Chow Tai Fook Enterprises took control of Alinta in 2017 from private equity firm TPG Capital, which had tried to float the company that once was part of the Babcock & Brown empire.

Alinta controls 85 per cent of the West Australian retail energy market and a raft of gas and coal-fired power assets, as well as some renewable energy assets.

Its exposure to coal will be the challenge for any buyer.

As of June 2020, it was generating $3.4bn in revenue and $239m of net profit.

It also owns the Braemar gas-fired power station in Queensland, the Bairnsdale gas-fired station in Victoria, the Reeves Plain power station development in South Australia and the Glenbrook co-generation plant in New Zealand, as well as the Loy Yang B coal-fired power station in Victoria.

This is in addition to wind farms in Victoria and WA and solar farms in Queensland.