Highbury Partnership on board for Forrest’s $4bn CWP Renewables buy

CWP Renewables could have a buyer from left field.

Andrew Forrest has stunned the market with a $4bn purchase of CWP Renewables, and by his side throughout the process to assist in landing his winning bid was adviser Highbury Partnership and law firm Clayton Utz.

Final bids for CWP were due last week, with Tilt Renewables and Iberdrola known as the final contenders, and they were believed to be in the dark about Forrest quietly building up an offer in the competition that was known as “Project Anemoi” (Anemoi meaning the four Greek gods of the winds).

It was known by some that Dr Forrest, who made his fortune through his major shareholding in the iron ore producer that he previously ran, Fortescue Metals, had been looking at CWP early on, and there has been suggestions of late about a mystery suitor also being there.

But Dr Forrest came out of left field to put on the table what sources say is a full price.

Dr Forrest bid through his venture Squadron Energy, which is part of his private investment business Tattarang, and DataRoom first revealed online on Wednesday that there were suggestions he was about to win the competition.

In what is an upset in the contest, as early as Tuesday, it was thought to be the QIC and AGL Energy-backed Tilt Renwables and Iberdrola vying for the business.

This week, CDPQ and Origin Energy left the CWP competition after they had earlier been considered the frontrunners, with Brookfield and EIG’s $15.5bn offer for Origin Energy complicating matters.

Working on the sale of CWP Renewables has been Macquarie Capital.

It is understood that when Dr Forrest lobbed his final offer, it was unconditional, with full regulatory approval in place.

Sources believe the other suitors may not have had such approvals and offered a lower price, and owner Partners Group was highly focused on an outcome with limited risk.

One of the appealling factors of the business for Dr Forrest is believed to be CWP’s high quality management team, although Squadron Energy is run by former Transgrid and Origin Energy executive Eva Hanly, who is an experienced industry operator.

Another appeal is the large development pipeline where thousands of megawatts can be added to the portfolio, with Dr Forrest prepared to outlay billions of dollars.

DataRoom earlier understood that Partners Group was holding an internal approval meeting on Tuesday or Wednesday to select a winning candidate in the competition.

CWP Renewables has a portfolio of assets in operation or construction generating 1.1GW of power in NSW and Victoria, and a 5GW development pipeline.

Customers include Sydney Airport, Snowy Hydro, Telstra and Transurban, with 70 per cent of revenues contracted to 2030 and an average contract lengths of 13 years.

Originally, about 30 parties were in the data room considering an acquisition of the business before first round bids were due in September.

It takes Squadron Energy’s renewable energy operating portfolio to 2.4 gigawatts with an Autsralian development pipeline of 20GW.

It is building the $3bn Clarke Creek wind, solar and battery farm which is set to power more than 600,000 Queensland homes, the Port Kemble Energy Terminal and is proposing the Port Kembla Power Station, which will be Australia’s largest duel fuel turbine running on 50 per cent gas and 50 per cent green hydrogen before transitioning to 100 per cent green hydrogen.

Squadron Energy group is also a foundation investor in the $30bn Sun Cable renewable project in the Northern Territory and is majority owner of renewable power company Windlab, in which CWP will likely be held.

Most of CWP’s assets are in NSW and some analysts believe Tilt or Iberdrola would be able to run the business with lower costs due to synergies.

But it forms a solid base to create a major wind energy business.

Market analysts say that the deal could also restrict industry consolidation.

It leaves Andrew Forrest with a vast amount of projects on the go, adding to his major investment in hydrogen as well as other renewables, iron ore and in other areas ranging from agriculture to retail.