Baird Government sells Ausgrid for $16.1 billion
NEW South Wales' Baird Government has delivered on its election promise to privatise the state's electricity infrastructure.
In a deal worth $16.189 billion, announced today, 50.4% of Ausgrid will be sold to Australian Super and IFM Investors.
Ausgrid supplies electricity to about 1.7 million customers with a network that covers most of Sydney and the Hunter Valley and all of Gosford and Newcastle.
I'm pleased to announce the successful partial lease of Ausgrid for $16.189 Billion to an all-Australian consortium.— Mike Baird (@mikebairdMP) October 20, 2016
The news comes after a bid by China's State Grid Corp was blocked by the Federal Government's Foreign Investment Review Board.
"This is another excellent result for the people of NSW after our successful $10.258 billion lease of TransGrid," NSW Premier Mike Baird told News Corp.
"Our poles and wires transactions are unlocking billions of dollars to fund new schools, hospitals, public transport and roads that will make a real difference to peoples' lives."
We're using the proceeds to build new roads, rail, schools and hospitals right across NSW.— Mike Baird (@mikebairdMP) October 20, 2016
Although technically a lease the deal runs for 99 years and as such is widely being reported as a sale.
However it was not without controversy.
Yesterday Fairfax media reported the process which led to the sale - an unsolicited proposal by the consortium involved - appeared to breach the State Government's own guidelines.
A story published by the Australian Financial Review stated unsolicited proposals seeking to purchase a state owned entity should only be approved in cases where the project in question has "unique attributes such that others could not deliver a similar proposal with the same value-for-money outcome."
The consortium involved argued its proposal was unique because it was all Australian.
NSW Labor Opposition Leader Luke Foley has called on the Baird Government to hold a competitive tender process instead.