SYDNEY: A Brookfield-led consortium’s A$16.3bil (US$10.61bil) bid for Origin Energy is expected to fail after the largest shareholder in Australia’s biggest energy retailer says it will vote against the offer.

Australian Super, which has a 16.5% stake in Origin, said the offer substantially undervalued the company’s ability to profit from the shift to renewable energy, and had already said it would vote “no”.

Without the support of the A$300bil pension fund, Australia’s largest, the consortium will struggle to receive the level of backing it needs to succeed under local takeover laws.

Proxy votes were due to be lodged on Tuesday, meaning major institutional investors have already voted, but a shareholder meeting was held here yesterday.

The deal would be Australia’s second largest buyout in 2023 after Newmont Corp paid US$17.8bil for Newcrest Mining.

The energy company’s shares closed on Wednesday at A$8.42, up 1.69%, but well below the offer price of A$9.43 per share.

Brookfield Corp, which has teamed up with EIG Partner’s MidOcean Energy, has offered Origin shareholders A$6.59 and A$1.86 in cash and a A39c special dividend.

At the time of the new offer on Nov 2, the bid equated to A$9.53 per share, but foreign exchange volatility has pushed that down to the current level.

The subdued share price suggested investors did not believe the deal would go through, according to Jamie Hannah, deputy head of investments and capital markets at VanEck Australia, which voted its 0.3% stake in support of the deal. — Reuters