Mike Cannon-Brookes’ Latest Move To Keep AGL’s Shit Together

Tech billionaire Mike Cannon-Brookes’ Grok Ventures is now the proud but troubled owner of a shedload of AGL shares. And he’s already using his new-found clout.

In June last year, AGL Energy Limited announced its intention to split the company into two separately ASX-listed businesses. Accel Energy is to carry the electricity generation portfolio – much of it coal power – and AGL Australia will be the retail and flexible energy trading, storage and supply business.

At the time, Greenpeace Australia Pacific described the plan as “putting green lipstick on a pig” and that Accel Energy would be an “epic dud of an investment”.

Mike Cannon-Brookes took a similar view, believing there was a better future for AGL – one that would see an exit from coal power fast-tracked in favour of cheap renewable energy for everyone’s benefit. So, he tried to buy the company with the assistance of Canadian asset management firm Brookfield. Long story, short – that failed.

But he wasn’t done yet.

Grok Ventures Swoops In

Yesterday evening, Mr. Cannon-Brookes announced his private investment company Grok Ventures had acquired more than an 11% interest in AGL, becoming the company’s largest shareholder. He also announced the launch of KeepItTogetherAustralia, a campaign urging AGL shareholders to vote against the demerger.

Mr. Cannon-Brookes says AGL is the single largest contributor to carbon emissions in Australia and the demerger will threaten AGL’s renewable energy transition.

“The demerger makes no sense, or cents,” he said. “We believe it destroys value for everyone – shareholders, employees, Australia and the planet.”

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“We believe that keeping AGL together is the best way to put the company back at the forefront of energy generation in Australia,” states the campaign website. “A combined AGL can deliver more affordable, reliable renewable energy and a better future for shareholders, customers and future generations.”

After securing his swag of shares, Mr. Cannon-Brookes sent a letter to AGL’s Board outlining why the demerger was a bad idea and flagging an intention to vote every AGL share Grok Ventures controls against it. A copy of that letter can be viewed here.

The demerger will be put to a vote on June 15, 2022.

AGL Coal Clunker Carks It

Prior to this, Unit 2 at AGL’s Loy Yang A Power Station in Victoria experienced a fault and was taken out of service on Friday 15 April 2022. AGL said yesterday it currently expects the unit will return to service by 1 August 2022. The problem with Unit 2 was identified as being a failure of generator rotor insulation. The estimated total financial impact of this outage will be approximately $73 million according to the company.

AGL also sent out a letter to shareholders yesterday indicating the Board was still committed to delivering the demerger.

In the Grok Ventures letter, Mr. Cannon-Brookes warned:

“If the demerger proceeds, we believe AGL customers and Australian taxpayers will inevitably bear the consequences, as Accel Energy’s ageing coal fleet could lead to increased instances of plant failure and high electricity price events.”

Original Source: https://www.solarquotes.com.au/blog/cannon-brookes-agl-mb2458/