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AGL Energy Limited (ASX:AGK) has had its bid for New South Wales power producer Macquarie Generation rejected by Australia’s competition regulator.
The gas and electricity retailer had already inked a $1.5 billion deal to buy the New South Wales state-owned power plants last month.
However, the transaction was subject to regulatory approval and the Australian Competition and Consumer Commission has today ruled to oppose the purchase.
The competition watchdog says the proposed acquisition will likely result in a substantial lessening of competition in the market for the retail supply of electricity in the state.
Responding to the announcement AGL says it is reviewing the reasons for the ACCC’s decision and will make a statement about what actions, if any, it may take in due course.
AGL Energy’s net profit dropped 27.1 per cent to $261 million in the first half of the 2014 financial year.