Brookfield Asset Management’s (NYSE:BAM) (TSE:BAM)-led consortium’s “best and final” offer to acquire Origin Energy was slammed by its top shareholder. The consortium has put forward a revised offer to acquire the Australian energy giant for $10.5 billion (equivalent to A$16.40 billion). However, Origin’s top shareholder, AustralianSuper, the country’s largest pension fund, is deciding to vote against the bid as it remains “substantially below” Origin’s long-term value estimates.
The Brookfield-led consortium had earlier offered to buy Origin at A$8.81 per share, which was rejected by AustralianSuper, which holds 13.68% of Origin. Following this, the consortium upped the offer by 8% to A$9.53 per share on November 1. Notably, Origin’s board unanimously approved the sweetened deal and has urged shareholders to vote in favor of the offer on November 23, in the absence of another suitable deal.
If the bid gets a green signal from shareholders, the Canadian alternative asset management company Brookfield, along with Singapore-based GIC Private Ltd. and Temasek, will take over Origin’s Energy Markets business, including power generation and retailing. Meanwhile, the other big consortium partner, EIG Global Energy, will take over Origin’s integrated gas business, including its majority stake in the Australia-Pacific LNG project.
Is BAM a Buy, Sell, or Hold?
Ahead of BAM’s Q3 print set for November 6, TD Securities analyst Cherilyn Radbourne cut the price target to $42 (42.7% upside) from $48 and maintained a Buy rating.
On TipRanks, BAM stock has a Hold consensus rating based on four Buys, three Holds, and two Sell ratings. Also, the average Brookfield Asset Management price forecast of $37.56 implies 27.6% upside potential from current levels. Meanwhile, year-to-date, BAM stock is up 6.5%.
