Billionaire Mike Cannon-Brookes, Brookfield Walk Away From AGL Bid As Sweetened Offer Rejected

Tech billionaire Mike Cannon-Brookes’ Grok Ventures and its partner Canada’s Brookfield Asset Management are walking away from their joint bid to acquire AGL Energy after the Australian electricity producer rejected the consortium’s sweetened offer.

Brookfield and Grok Ventures had on Friday raised their offer to buy 100% of AGL Energy for about A$5.4 billion ($4 billion), from the consortium’s original bid of A$5 billion that was made last month. Over the weekend, AGL Energy rejected the latest offer of A$8.25 per share, saying “the revised unsolicited proposal is still well below both the fair value of the company on a change of control basis and relative to the expected value of the proposed demerger.”

AGL Energy proposed in March to split the company into separate publicly traded companies: AGL Australia and Accel Energy, aiming to cut greenhouse gas emissions by as much as 60% by 2034. The demerger is progressing well and on track for completion by June this year, the company said last month.

The consortium’s latest proposal “ignores the momentum we have recently seen in the business through our solid half year result, strong progress on the demerger, strong interest in our energy transition investment partnership and improvements we are seeing in forward wholesale prices,” AGL Energy said in a statement.

Following the latest rejection, Cannon-Brookes tweeted: “The Brookfield-Grok consortium looking to take private & transform AGL is putting our pens down, with great sadness.” Brookfield and Grok Ventures declined to make further comments when asked by Forbes Asia to elaborate.

The consortium had planned to accelerate AGL Energy’s transition into cleaner fuel and achieve net zero emissions by 2035. That plan would have required about A$20 billion in investments, the partners said in February.

Cannon-Brookes, cofounder and co-CEO of collaboration software firm Atlassian, has been stepping up investments in renewable energy and is a key backer of Sun Cable, billed as the world’s largest solar project, along with mining billionaire Andrew “Twiggy” Forrest. Sun Cable is constructing a mega solar farm in the deserts of Australia’s Northern Territory to supply electricity to Darwin by 2026 and to Singapore the following year via a 4,200-kilometer-long High Voltage Direct Current undersea cable.

With a net worth of $16.5 billion, Cannon-Brookes, 42, is the the third-richest person in Australia, according to Forbes’ real-time data. His self-funded Grok Ventures aims to invest A$1 billion in renewable energy and other sustainable projects in the next few years, on top of the A$1 billion the firm has already invested.