After its collapse due a disagreement between two key stakeholders, billionaires Andrew Forrest and Mike Cannon-Brookes, regarding the company’s cornerstone project, Sun Cable has officially began the sale process.
Administrators FTI Consulting have appointment MA Moelis Australia as an adviser on the sale, which it is hoping to finalise within the next four months.
The sale, or potentially the recapitalisation, of Sun Cable is necessary to ensure the progress of its $30 billion (USD 21 billion) Australia-Asia PowerLink project, which is proposing a giant solar farm, up to 20 GW, coupled with as much as 42 GWh of battery storage in the Northern Territory, to then send that power to Singapore using 4,200 kilometres of sub-sea cables.
Bloomberg has reported iron-ore magnate Andrew Forrest, whose private firm Squadron Energy owns a major stake in Sun Cable, is among the parties considering making an offer. There has also been speculation tech billionaire and Atlassian co-founder Mike Cannon-Brookes, whose Grok Ventures also owns a major stake in Sun Cable, will bid.
These two billionaire owners have failed to agree on the direction of the project, with Sun Cable chairman Cannon-Brookes supporting its current form and Forrest reportedly looking to scrap the sub-sea cable element in favour of domestic energy use and green hydrogen production.
In the meantime, Cannon-Brookes via Grok Ventures has provided Sun Cable with a $65 million interest free loan to maintain its employees and project momentum.
FTI Consulting described Stage 1 of the Australia-Asia PowerLink project as being “materially progressed,” having gained federal and local government support and a number of the required approvals.
However, Bloomberg has reported lawyers for FTI told Australia’s Supreme Court last week that Sun Cable had less than $3.6 million in cash and looming bills of more than $10 million.
“The Administrators are seeking binding proposals for the sale of Sun Cable by end of April 2023, with targeted completion no later than the end of May 2023,” FTI Consulting said in its statement.
“Moelis will now commence a process to invite offers for sale or recapitalisation of the company.”
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