Stonepeak is believed to be out of the contest to buy Singapore Power’s 40 per cent stake in the $5bn Jemena gas business, but a deal with another suitor is likely soon.
Some say GIP is the most likely acquirer.
It showed interest some months ago, it’s not clear if it is still in the mix.
GIP is understood to have had a lending syndicate in place.
It has a low cost of capital and already owns other gas-related assets, so an acquisition would be logical.
Other pension funds see assets linked to fossil fuels as less appealing.
Foreign suitors may struggle to gain approval from the Foreign Investment Review Board.
Earlier, Stonepeak had hired investment banks JPMorgan and Macquarie Capital.
The asset that is up for sale through Wall Street rival Goldman Sachs.
It is understood that final bids have been received.
The asset is on Singapore Power’s books for $1.6bn.
Jemena owns Australian energy infrastructure assets, including gas pipelines, and gas and electricity networks in Victoria, NSW, Queensland and the Northern Territory.
China’s State Grid owns 60 per cent and Singapore Power the rest.
Matters for a suitor to consider include the future of the LNG import terminal at Port Kembla in NSW which is being built by the Andrew Forrest-controlled Squadron Energy to address looming gas shortages.
The terminal would enable gas to flow into NSW from Victoria.
Another issue is Treasury’s consultation on foreign tax and how that may affect Singapore Power.
There have also been questions about whether Jemena has the gas reserves to support the pipelines, and whether they are economical.
US-based GIP is a leading infrastructure investor with more than $US100bn ($147bn) of assets under management globally.
In Australia, it owns stakes in Sydney Airport, the ports of Brisbane and Melbourne, and the GLNG plant on Curtis Island near Gladstone.
It is currently bidding with Dexus to buy Gold Coast Airport owner Queensland Airport, competing against Skip Capital (with KKR) and the Bank of America-advised AustralianSuper, which is bidding alone.
It is also in the contest for the $20bn data centre operator AirTrunk, bidding against Blackstone and Canada Pension Plan Investment Board as part of a consortium with Digital Bridge, Silver Lake and IFM.
The sale of Jemena comes as energy sources and supplies remain high on the agenda in the political debate.
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