AGL Energy has no plans to break up Vocus
- 12 June, 2019 14:59
AGL Energy has no plans to break up its takeover target, Vocus Group, but instead will aim to grow the combined businesses, AGL CEO Brett Redman said.
AGL announced a $3.02 billion tilt for Vocus on Tuesday, sparking a sharp fall in AGL's shares as investors questioned why Australia's top power producer needed to buy a struggling company with a fibre optic network.
Redman said on Wednesday AGL saw Vocus giving it a leg up in being able to offer new energy and data-blended products, although in the long run there may be parts of the Vocus business that were "not mission critical" to that objective.
"At this point we haven't said that there's anything that we would expect to exit," Redman told reporters on the sidelines of an energy conference in Melbourne.
"We're not going into this with a mindset of break-up. We're going into this with a mindset of growing and combining the businesses."
AGL unveiled an offer to pay customers in South Australia, Victoria, New South Wales and Queensland states to team up their rooftop solar panels and batteries into a "virtual power plant" that AGL would coordinate to boost power supply into Australia's strained grid at peak times.
Redman cited that product as an example of how AGL could put Vocus's network and data centres to use.
"All these new products and services that are emerging can be done without owning a fibre optic network. But our ability to do them will be enhanced if we do," he said.
AGL's shares recouped some losses on Wednesday, climbing 1.8 per cent and outperforming the broader market.
(Reporting by Sonali Paul; Editing by Stephen Coates)