You can be your life the bidding will be high, given the cost per Mw for replacing these assets is in the order of $1m to $1.4m, and Alinta have 3000Mw of generating capacity.
No doubt a few armchair market analysts don't see it this way. Rather they have underestimated this sort of stance, yet the plain fact is most of Alinta's generating assets are in quite a good state, age wise
I still think Origin will make a pitch for the entire company though, and if they do they can pick and choose which assets will not be core to their business then they will sell them at a time of their choosing. Origin are cashed up enough to do this so I see Alinta as a good fit for expansion by aquisition. Indeed, a cheap way to get a lot bigger
Doubtless, TPG are also viewing the assets along the same lines with their idea of converting debt to equity, however I think the AEJ directors will resist this move unless the price reflects fair asset value
Meanwhile most of the market seems focused on AEJ debt. . Wrong move !
AEJ Price at posting:
5.3¢ Sentiment: Hold Disclosure: Held
