Mike Cannon-Brookes wins, earth yawns and we pay the bill after AGL abandons plan to split

Tech billionaire Mike Cannon-Brookes. Picture: Nic Walker

Earth to Grok: frankly my dear, I don’t give a damn.

Grok is the corporate vehicle that tech billionaire Mike Cannon-Brookes has been using to pursue and to torment energy group AGL over its now abandoned plan to split into two separate companies.

Hailing its success in forcing that abandonment, Grok portentously and pompously proclaimed: “We believe that is in the best interests of shareholders, customers, Australian taxpayers and the planet.”

Actually, AGL could immediately close all its coal-fired power stations – and indeed its gas-fired ones, cut all its gas pipelines and even tear down or abandon all its quaintly-titled wind and solar ‘farms’ – and the planet, earth, Gaia, wouldn’t even notice.

Not even by a tenth, nay a thousandth of a degree.

Not when China is ‘adding an AGL’, in terms of CO2 emissions, every week or two.

As for the other claims, any benefits to shareholders and taxpayers are dubious to debatable; and customers are going to find out in their gas and electricity bills, as the now Cannon-Brookes AGL gives it to them good and hard.

Tech billionaire Mike Cannon-Brookes.

It is more than a touch ironic that just one week on from the Federal election – decided on the tried and true basis of winning being at least 50.1 per cent – Cannon-Brookes won with perhaps 20 per cent.

AGL abandoned its demerger because it was now clear it would not be approved by its shareholders at the coming general meeting.

Approval of these exercises requires not 50.1 per cent but 75 per cent of the shares voted by proxy or at the meeting.

Unlike our political elections voting is not compulsory.

So if only, say, 80 per cent of the shares were going to be voted, Cannon-Brookes only needed 20.1 per cent of the issued shares to stop it.

He was probably going to get enough support, on top of his own 11.3 per cent stake, to get at least there.

Let me say at once, it is entirely appropriate that demerger and other similar seminal proposals are required to get at least 75 per cent.

But let’s not see it as a successful exercise of ‘climate change corporate democracy’; a sort of replay in the corporate and business space of the – what I suggest will increasingly become – the infamous Teals of a week ago.

Two big-picture points need to be made.

The first is that chairman Peter Botten and CEO Graeme Hunt had to go.

The demerger was their proposal.

The entire strategic future of the group was built on it; and indeed everything about the group – the proposed two separate companies – on a detailed day-to-day management basis going forward.

AGL Energy CEO Graeme Hunt is leaving the company.

The forced abandonment was a comprehensive rejection of their leadership.

There was no way they could stay.

It does raise though a rather interesting question. Botten and Hunt have effectively been sacked by a what? – 11.3 per cent vote; the Cannon-Brookes holding? – 15 per cent; adding on some instos? – 20 per cent; adding on some more and some ‘green’ retail?

When a 25, even a 50, percent vote to reject the rem report has zero impact.

The second point is the bizarre irrationality of the Cannon-Brookes opposition to the demerger.

He got into his head that it would delay the closure of the coal-fired stations and limit AGL’s embrace of renewables. In fact, it was going to make absolutely no difference. Closures will be driven by policy and profit – and loss – reality; and so also with the investment in renewables. And that will be exactly the same whether there were two AGL companies or just the one.

Either way, the cheap, plentiful and reliable electricity that we have – that we used to have – will well and truly, quite literally, be “Gone With The Wind”.