Spark Infrastructure, the owner of SA Power Networks (formerly ETSA), has acquired an interest of a minimum of 14.1 per cent in DUET Group, a company with energy assets in WA and Victoria.
DUET Group’s assets include an 80 per cent stake in the Dampier to Bunbury gas pipeline and a 100 per cent interest in gas pipeline developer, DBP Development Group, in Western Australia, a 100 per cent stake in Multinet Gas Group Holdings in Victoria, and a 66 per cent stake in United Energy Distribution in Victoria.
In an announcement to the stock exchange this morning, Rick Francis, managing director of Spark, said the investment brought further quality assets into Spark’s portfolio.
“We believe the acquisition of the 14.1 per cent interest in DUET Group at the average entry price of $2.16 per stapled security is economically and strategically attractive,” he said.
“It is expected to provide cash flow accretion and creates optionality for future value extraction.
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“DUET’s portfolio of assets is consistent with Spark’s investment mandate of investing in quality electricity, gas and water regulated and long-lived infrastructure assets, and provides portfolio diversification on a geographic, energy and regulatory basis.”
The acquisition was funded via contracts with Deutsche Bank through a combination of embedded funding and new equity.
Spark today launched a fully underwritten equity raising of $200 million which it says complements the funding embedded within the derivative contracts.
In addition, Spark has corporate bank facilities which total $275 million and are fully available, as and when required.
The board also provided guidance for a 2014 half year distribution of 5.75 cents per share and has reconfirmed its fullyYear 2014 distribution guidance of 11.5 cents, and growth of 3-5 per cent in distributions per security for 2015, subject to business conditions.
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