Energy transaction advisors lose millions in BHP Billiton deal
Energy transaction advisers (ETAs) are being targeted by BHP to be bought out by the Chinese energy giant, according to industry sources.
Key points:The company has lost $US5 billion in revenue since 2008The move will see the company’s stock plummet by as much as 50%BHP has not yet made any public announcements about the deal, but insiders have told Fairfax Media that the takeover has been delayed by BHPs decision to cut costs.ETAs are financial advisers who are paid to manage the finances of energy companies such as coal and gas companies, but the move to sell them would have been a dramatic blow to the sector.”BHP is going to have to make a decision whether or not to buy the company, or sell it to someone else,” said a former senior BHP executive who has worked in the sector for more than a decade.
But it is the loss of about $US1 billion in annual revenue that has made the deal look like it is on the verge of being completed.””
It will be a significant loss to the industry as a whole.”BHP’s takeover of the Australian energy sector has been widely expected, and was also confirmed by Treasurer Scott Morrison earlier this month.
But it is the loss of about $US1 billion in annual revenue that has made the deal look like it is on the verge of being completed.
“The deal is going through and they are trying to put it together, so the deal is happening,” said the former executive.
The takeover deal would mean that BHP would own a majority stake in the energy giant.
This would give it the power to negotiate deals with utilities, the like of which have traditionally been dominated by the likes of BHP, ExxonMobil, Rio Tinto and BHP’s parent company, Rio.
However, the transaction would also leave the current CBA (Commonwealth Utilities Board) and the current energy regulator the Energy Performance Commission (EPC) with only a very limited role in the industry.
Under the proposed takeover, BHP and its investment arm BHP Capital Partners would have control over the investment of up to $US50 billion in energy projects and investments.BHP Capital is also expected to be involved in the sale of the energy company’s other assets, including its mining and infrastructure arm.
In addition, the deal would allow BHP itself to become a majority shareholder in the company.
“I think the biggest risk to the company is the company itself, because it will not be able to operate,” said one source who has dealt with the BHP-owned energy company.
“[BHP] is going all in on their own assets, and the risk is that the company will go bankrupt, or will not survive in the long term.”
But there’s no reason to think they will fail.
They have been very successful for a long time and I think they are going to keep on operating.”‘BHP-like’ investment strategyThe proposed deal will see BHP acquire the equity in energy companies it holds and buy the rest from its shareholders.
It would also be a huge blow to an industry that has been under pressure from the energy giants to diversify its business.”
This deal will create a BHP like company,” said Michael McLean, a former director of the Energy Market Operator.
McLean said the company was looking to buy energy companies and sell them as quickly as possible.”
They’re going to take the money and turn it into money and they’re going in to take control of it,” he said.”
We are not talking about taking control of the company but they’re basically buying it outright and buying up the rest of the companies.
“What I think is going on is the investors are really getting the short end of the stick.”
So I think the big risk for the company now is that they are just going to get dragged into the fight over whether they are in or out of the investment market.
“The move to buy out BHP is seen as a way to give the Chinese state the power of controlling the energy industry in a way it did not have previously.BHPs move will also see the loss and drop of millions in revenue from the Australian Energy Market.
BHP invested about $1.4 billion ($1.8 billion at today’s exchange rate) in energy assets in Australia in the three years up to March 2016.
According to data compiled by the Australian Financial Services Commission, the total amount invested by BHB was $US8.8 trillion in the Australian electricity market.BHS was able to make this money by selling assets that were already owned by the state or local government, and investing in the state’s energy assets, such as its coal-fired power stations.
A majority of the money BHP made from the sale was invested in the asset-management business that it bought.
While the deal to buy BHP out of its ownership would have allowed BHP investors to sell the assets it currently owns, the