A leading alternative asset manager has lobbed an $18.4 billion tentative takeover offer for Eraring power station's owner, mooting a deal that could have major ramifications for the Hunter's energy landscape.
Brookfield Asset Management and an LNG company have floated $9 a share for Origin Energy, a 54.9 per cent premium on Wednesday's closing price of $5.81.
At 10.45am on Thursday, Origin shares had soared 32.9 per cent to $7.73.
While the deal may appeal to shareholders, it could present major ramifications for the Hunter if it goes through given Origin's stake in both the existing coal and emerging renewable energy markets.
Origin owns Eraring power station, and in February announced plans to retire the Lake Macquarie generator in three years' time. But the takeover bid adds further uncertainty to that 2025 deadline, which the Newcastle Herald reported last month had already come into doubt.
The Australian Finacial Review quoted Origin CEO Frank Calabria indicating "Origin are actively considering whether the group's plan to shut its Eraring power plant ahead of schedule is realistic".
An Origin Energy spokesperson said last month nothing had changed, pointing to a February statement that noted the company would "continue to assess the market over time, and this will help inform any final decisions on the timing for closure of all four units."
In further Hunter impacts, the firm is also involved with Orica in a proposed green hydrogen production plant on Kooragang Island, which would be powered by renewable energy.
Regarding the takeover bid, Origin's board said it had entered into an exclusivity and confidentiality agreement to let the consortium conduct due diligence.
That is expected to finish within eight weeks.
Should a binding offer of $9 per share materialise, the board intends to unanimously recommend shareholders accept it.
"While the due diligence process advances, we will remain focused on the successful execution of our strategy," said Origin Energy chairman Scott Perkins.
Should the takeover proceed, the consortium intends that Brookfield - one of the world's biggest alternative investment management companies, with $80 billion invested in Australia - would acquire Origin's energy markets business.
"Brookfield has the global renewable power expertise and access to capital to support Origin's transition strategy," said Brookfield's Asia Pacific chief executive, Stewart Upson.
"Our business plan includes additional investment of $A20 billion by 2030 to build the required renewable capacity and storage and position Origin as Australia's leading 'greentailer'.
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