Tilt Renewables sale process sees new funds in the race

Tilt owns renewable energy assets in Australia and New Zealand.

Some new names have surfaced in the competition among infrastructure investors to buy $2bn-plus wind farm owner Tilt Renewables.

Fresh from agreeing to a deal to buy Vocus Group for $3.5bn, there is talk that Macquarie Infrastructure and Real Assets is joining forces with bidder APA.

Meanwhile, Aware Super is the party said to be linking up with the bidding consortium consisting of AGL Energy, Queensland Investment Corporation and existing investor Mercury Energy, which is listed in New Zealand.

Final offers are due on Friday for renewable energy owner Tilt, which is listed in Australia and New Zealand and owns solar and wind farms in both countries.

Should MIRA emerge alongside $11.25bn energy infrastructure owner APA, it would be a continuation of its recent spending spree, fuelled by a need to invest its funds amid a low interest rate environment.

APA is working with investment bank UBS and has made it through to the second round of the competition, along with Engie and ICG, advised by Azure Capital, and Canada’s CDPQ, advised by ICA Partners.

GL Energy and Queensland Investment Corporation are bidding through their jointly owned Powering Australian Renewables Fund (PARF), advised by Bank of America.

PARF had already teamed up with existing shareholder Mercury Energy, advised by Citi and Forsyth Barr.

Other superannuation funds may also emerge in the consortium to strengthen its proposal.

Early in the auction, the understanding is that Mercury was only keen on owning the New Zealand assets in the Tilt Renewables portfolio.

On offer is a 65.6 per cent interest in Tilt Renewables owned by the Goldman Sachs-advised Infratil, which placed the interest on the market in a defensive move after it rejected a $5.1bn takeover bid from AustralianSuper.

But the understanding is that suitors have been invited by Tilt Renewables’ adviser Lazard to bid for the entire company.

APA has also seen its shares trade lower of late and some suspect MIRA will sweeten its bid after it was earlier said to be gunning hard for the asset.

Another possibility is that MIRA could offer funding or buy assets after APA has won the auction.

APA last month announced an $11m loss for the first six months of the financial year, with a $249m writedown over delays and extra costs at its Orbost gas processing plant on Victoria’s Bass Strait coast.

MIRA agreed a deal this week to buy telecommunications provider Vocus with Aware Super for $5.50 a share and is said to be on the cusp of buying listed waste management provider Bingo Industries for at least $2.3bn with private equity firm CPE Capital.

It is also vying for the $300m-plus Vitalharvest Freehold Trust, competing against Roc Private Equity for the landlord of fruit and vegetable grower Costa Group.