SYDNEY, March 24 (Reuters) - AGL Energy Ltd on Monday took legal steps in hopes of getting the go-ahead to pursue a A$1.5 billion ($1.36 billion)acquisition of power supplier Macquarie Generation after its plans were scuttled by Australian competition regulators despite submitting the highest offer.
AGL said it had filed an application with the Australian Competition Tribunal for authorisation to acquire Macquarie Generation, which was put up for sale by the New South Wales government as part of broad scheme to privatise government holdings.
The Australian Competition and Consumer Commission (ACCC) earlier this month blocked AGL’s plans, saying a deal would have reduced competition in Australia’s most populous state.
“The ACCC’s decision has significant implications for the future of the energy industry in this country and, in our view, can’t be left unchallenged,” AGL Managing Director Michael Fraser said in a statement.
AGL said it wants the matter heard by the tribunal rather than in an Australian court because the legislated timeframe for decision making by the tribunal is normally shorter.
The ACCC on March 4 ruled that allowing AGL to buy Macquarie Generation, which supplies 27 percent of New South Wales’s electricity, would mean the state’s three biggest energy retailers would own up to 80 percent of its energy generators. That would raise barriers to entry and expansion for other electricity retailers, the regulator said.
AGL has been counting on the acquisition to step up its competition with Origin Energy Ltd and Hong Kong-based CLP Holdings Ltd’s Energy Australia in the retail power market.
The main under-bidder to AGL, ERM Power, was ruled out this month as an acquirer by New South Wales Treasurer Mike Baird, who said its offer was too low. ERM is reported to have bid about A$1.2 billion.
Analysts would not rule out ERM returning with a higher offer at some point.
$1 = 1.1002 Australian dollars Reporting by James Regan; Editing by Matt Driskill