Atlassian co-founder Mike Cannon-Brookes and his investment partners have emerged as the owners Sun Cable after a near six-month sales process following the collapse of the company behind a vast solar energy project.
Sun Cable, which intends to construct a large solar plant in Australia’s north before shipping power to Singapore using an undersea cable, fell into administration in January after Mr Cannon-Brookes fell out with the company’s other major shareholder, Fortescue Metals chairman Andrew Forrest.
Mr Cannon-Brookes’ private investment vehicle, Grok Ventures, will acquire Sun Cable after winning a bidding process run by FTI Consulting. The investment is backed by Quinbrook Infrastructure Partners, as first flagged by The Australian Financial Review’s Street Talk column on Thursday.
Mr Cannon-Brookes said the agreement was a “big step in the right direction” for the project. “We’ve always believed in the possibilities Sun Cable presents in exporting our boundless sunshine, and what it could mean for Australia. It’s time to stretch our country’s ambition,” he said.
“We need to take big swings if we are going to be a renewable energy superpower. So swing we will.”
Grok and Quinbrook intend to spend several weeks undertaking more detailed work with Sun Cable management before outlining their development priorities for the project. Dr Forrest had intended not to proceed with the 4200-kilometre undersea transmission cable between Darwin and Singapore if he was successful in acquiring the company.
The company has been tipped to need $35 billion in project funding. The cable was the bone of contention between the two billionaires and sparked the public rift between them – as well as the administration.
Dr Forrest said he remained “unconvinced of the commercial viability of the Australia-Asia Powerlink”, adding that his company, Squadron Energy, “did not participate in the final binding bid process for Sun Cable”.
“Squadron decided the capital allocation did not align with Squadron’s strategic goals, as we are already working to deliver 30 per cent of the renewable energy required to meet the federal government’s target of 82 per cent renewables by 2030, and want to bring new green electrons into the grid as soon as possible,” Dr Forrest said. “We have decided to focus on the existing 20GW pipeline of assets as a much faster way to achieve those goals and take Australia closer to a carbon-free future.”
Dr Forrest added: “As an interested shareholder we look forward to better understanding the details of the deal.”
Grok had already scored an early win during the administration, putting forward a successful proposal to provide Sun Cable with $65 million in interim funding while the sales process played out.
FTI was advised by Moelis during the sale process.
David Scaysbrook, the managing director of Quinbrook, said: “With construction well under way on the largest solar-plus-storage projects ever undertaken in the US and the UK, [the fund] is well positioned to assist Grok to complete the development of what promises to be not only one of the largest renewables projects in Australia, but a project of global significance.”
Moelis, alongside Macquarie, had already been working with Sun Cable to find its $30 billion project funding. It had raised $210 million in March 2022 to keep it rolling through 2023, but a high cash burn meant it was forced to consider raising more money, creating disagreement between Mr Cannon-Brookes and Dr Forrest about how to proceed. Others who had invested last year included MYOB founder Craig Winkler, NextDC chief executive Craig Scroggie and Beyond Zero Emissions boss Eytan Lenko.
FTI said that, based on the pre-administration claims that are outstanding, the transaction is expected to allow for unsecured creditors of Sun Cable to be paid in full. The completion of the transaction is subject to the satisfaction of customary conditions and administrative matters.
Source: Australian Financial Review
