Centrica and Tenaga said to have posted Initial bids for Bord Gáis Energy
State company has €1 billion-plus price tag
The Government is selling the State company’s energy business, said to be worth over €1 billion
At least two of the international utilities said to have been circling Bord Gáis Energy were reported to have submitted initial bids for the State-owned business by yesterday’s deadline.
The Government is selling the State company’s energy business, said to be worth over €1 billion, as part of an overall programme of asset disposals agreed with the EU/IMF troika and aimed at raising €3 billion for the exchequer.
Close of business yesterday was the deadline for potential buyers to submit initial, non-binding, bids for the operation, and both British player Centrica and Malaysian energy group Tenaga Nasional Bhd were said to have filed offers.
Bord Gáis itself would not comment beyond saying that “interest in the company is strong”, so it is not known how many actual bids were submitted to its advisers, Royal Bank of Canada Capital Markets.
Centrica has long been regarded as a front-runner as both companies are similar and the British player is on the record as saying that it is interested in entering the Irish market.
It is understood that it has spoken to a number of infrastructure funds about the possibility of forming a consortium for the second stage of the bidding process.
According to some reports, it is likely that the partner would take the Irish State company’s wind energy business. Centrica has been selling off part of its British wind-powered generators.
The Bord Gáis portfolio includes wind farms with the capacity to generate up to 250 mega watts of electricity – around half what an average gas power plant can produce – plus a similar amount in various stages of development.
There is also speculation that Centrica may go ahead and bid for the business on its own and sell the wind farms at a later date if it is successful.
Bord Gáis Energy sells natural gas and electricity to consumers and industry. Along with its wind farms it owns a modern gas-fired power plant in Cork and operates gas and electricity trading businesses.
Various reports have valued it at between €1 billion and €1.4 billion, although industry sources have suggested that the higher end of these estimates may be optimistic. Additional reporting: Bloomberg