Australia's Endeavour Energy attracts at least three indicative offers - sources

Sun Feb 12, 2017 9:54pm EST
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By Jamie Freed

SYDNEY (Reuters) - Australian state-owned power grid Endeavour Energy has attracted indicative offers from at least three bidding groups comprised of local and foreign investors, according to sources involved in the process.

The offers for a majority stake in the utility, which is expected to fetch at least A$4 billion ($3.07 billion), are not binding and final prices will not be provided by bidders until due diligence is completed, four sources told Reuters.

The sources, who confirmed the involvement of three consortiums led by Macquarie Group (MQG.AX: Quote), Queensland Investment Corp and Hastings Funds Management respectively, declined to be named for reasons of client confidentiality.

Endeavour is being sold by New South Wales state as part of a broader privatization program to fund infrastructure development, at a time when foreign investment in assets like power grids and ports is facing increased scrutiny.

The federal government in December advised potential bidders that no single foreign investor could own more than half of the stake in Endeavour being sold, while a domestic investor must hold at least 20 percent.

The guidance was given after the government's surprise rejection in August of bids for a controlling stake in larger New South Wales power grid Ausgrid by China's State Grid Corp [STGRD.UL] and Hong Kong's Cheung Kong Infrastructure Holdings (CKI) (1038.HK: Quote) on national security grounds.

Ausgrid was eventually bought for A$16.2 billion by domestic funds IFM Investors AustralianSuper in October.

The three confirmed bidders for Endeavour are consortiums comprised of local and foreign investors, the four sources said.   Continued...