CANBERRA: Energy infrastructure owner DUET Group has made it clear it is not done yet with acquisitions, after striking a $205 million deal to buy out Alcoa from their jointly owned gas pipeline in Western Australia.
The purchase of Alcoa’s 20 per cent stake in the Dampier-Bunbury pipeline, WA’s key gas transmission line, had been anticipated in the market as DUET had made no secret of its appetite to move to full ownership of its operating assets.
It will be funded by about $230 million in fresh equity from an institutional placement and share purchase plan priced at $2.20, a 3.5 discount to Wednesday’s close of DUET securities. Details of the raising were first revealed by Street Talk on Thursday morning. Chief executive David Bartholomew said the move would further simplify DUET’s structure, given that now it would own 100 per cent of four of its five operating businesses.
He said in February that DUET was on the lookout for acquisitions again after wrapping up the purchase of Energy Developments Ltd. Sources had suggested that Alcoa’s stake in the WA pipeline was a potential target. DUET is also thought to have examined other assets on the market, including TransAlta Australia’s stake in the Fortescue River Gas Pipeline in WA. Alcoa, which was the initial cornerstone customer for the Dampier pipeline, is to maintain access to about 30 per cent of the transmission capacity of the line, which feeds its three alumina refineries in WA.
