Some Real-Life ‘Succession’ Shit Just Went Down At AGL Energy
The dirty energy giant's CEO and Chairman both resigned yesterday.
Why pay for HBO dramas when you can simply watch the news for free??
The future of the notorious Australian energy giant AGL has been thrown into disarray, with the company’s CEO and Chairman announcing their respective resignations yesterday. The chaos comes after a proposed demerger from AGL Energy’s coal and retail interests was suddenly cancelled, due to pressure from its billionaire investment partner and green energy champion Mike Cannon-Brookes.
Wow. A huge day for Australia đź’šđź’›
Had to sit down & take it in. This live shot couldn’t be a better metaphor for a better, greener path ahead 🌱
We embrace the opportunities of decarbonisation with Aussie courage, tenacity & creativity.
Lots of work but we CAN do this 👊🏻 pic.twitter.com/mSCQl554C0
— Mike Cannon-Brookes 👨🏼‍💻🧢🇦🇺 (@mcannonbrookes) May 29, 2022
After Being Rejected Twice, Mike Cannon-Brookes Pulled An ‘Elon Musk’
AGL Energy is one of Australia’s oldest power companies and the nation’s biggest polluter. Government records showed that between 2019 and 2020 the company produced over 42 million tonnes of carbon emissions, eight percent of Australia’s total emissions during that period.
A consortium of several different investors — including billionaire climate change advocate Mike Cannon-Brookes and Canadian assets firm Brookfield — entered an $8 billion bid to buy AGL in February this year, proposing to accelerate the company’s transition from fossil fuels while re-directing investment into green energy.
AGL is Australia’s largest polluter. AGL’s coal power stations make up 8% of Australia’s emissions. @mcannonbrookes says he’s confident AGL -could- be net zero by 2035.
“We believe we can do this sensibly. Beyond the acquisition, we have a budget of $20b for renewables.”
— Climate Council (@climatecouncil) February 20, 2022
After lengthy negotiations which saw the price of the bid soar to $10 billion, the deal was ultimately knocked back by the company in March, with the AGL board ultimately choosing to demerge into two different companies rather than sell.
The proposed demerger would have seen AGL Australia running retail energy services and some new clean power ventures, with Accel Energy forming to run the company’s coal power stations.
However, the demerger required the approval of at least 75 percent of shareholders to proceed, which looked increasingly unlikely after Cannon-Brookes bought enough stock in the company to become the biggest shareholder in AGL last month, personally owning almost half the required shares needed to derail the deal.
Both AGL’s Chairman And CEO Stood Down Yesterday
Yesterday AGL offical cancelled its plans for the demerger, saying that “the path is no longer available” in a statement provided to the Australian Security Exchange.
“AGL Energy believes that the Demerger Proposal would have been supported by a majority of shareholders… many of whom are long term holders of AGL Energy shares.” an AGL spokesperson said. “However, having regard to anticipation turnout and stated opposition from a small number of investors including Grok Ventures (Cannon-Brookes’ company), AGL believes that the Demerger Proposal will not receive sufficient support to meet the 75 percent approval threshold for a scheme of arrangement.”
The statement also came with a list of resignations from the company, including CEO Graeme Hunt and Chairman Peter Botten.
The company will now form a strategy sub-committee that will report back to shareholders in September, which promises to investigate the best ways to maximise “shareholder value in an environment where pressure on decarbonisation and energy affordability is accelerating” and promised to consult with a broad range of groups “including Grok Ventures”.
Experts Say AGL Bloodbath Was Years In The Making
The climate lead from Australasian Centre for Corporate Responsibility (ACCR) has blamed AGL Energy’s stubbornness in implementing climate targets for their recent failures, calling yesterday’s events a “bloodbath”.
“By failing to set Paris-aligned targets for the proposed demerged entities, the board of AGL ignored a fundamental demand of a majority of shareholders less than a year ago, and they’ve now paid the price,” said climate lead Harriet Kater in a statement.
“With the abandonment of the demerger, the departure of four directors is a welcome step towards a brighter future for AGL shareholders.”
While there’s hope that the changes at AGL could help lead to a rapid transition out of fossil fuels, Australians are sick of energy-related political subterfuge.
From Kevin Rudd being ousted from Government for introducing a mining tax, to Malcolm Turnbull being knifed for not being able to put an energy policy together, I’d just like it if we could get some unified and peaceful action on climate change. Pronto, please!