Australian energy infrastructure company APA Group (ASX:APA) on Monday said it has acquired a stake in the debt of Basslink, the Tasmania-mainland Australia interconnector, and is interested in buying the link.
Basslink Pty Ltd entered into voluntary administration and receivership on November 12. It owns and operates the 370-km (230 mile) high voltage direct current (HVDC) interconnector which can carry 500 MW of electricity both ways between Tasmania and Australia’s National Electricity Market. APA said the link is critical to exporting Tasmanian renewable energy to the Australian mainland.
APA has purchased an interest in the debt of Nexus Australia Management Pty Ltd, the borrowing entity for Basslink. The energy infrastructure group said the face value of the debt is about AUD 99 million (USD 71.6m/EUR 63.5m) and it has acquired a stake of unspecified size in it at a discount.
APA stated an interest in buying Basslink from the receivers and managers. Should it manage to do so, APA plans to work with stakeholders, including Hydro Tasmania, the state of Tasmania and the Australian Energy Regulator to convert Basslink to a regulated asset.
“The potential acquisition of Basslink is consistent with our strategy to expand our electricity transmission footprint and invest in renewable energy sources,” said APA chief executive and managing director Rob Wheals.
Basslink had attributed the administration decision to ongoing disputes with its customer Hydro Tasmania related to a failure of the Basslink cable in 2015 and an unsuccessful sale process with APA. APA previously held discussions to acquire the link with Basslink’s owner Keppel Infrastructure Trust.
(AUD 1 = USD 0.723/EUR 0.642)
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