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Origin to raise $2.3b using new offer model

Origin to raise $2.3b using new offer model

Origin Energy (ASX:ORG) plans to raise $2.3 billion to pay for recent NSW energy acquisitions and allow it to pursue more purchases.

The company has announced a 1-for-5 renounceable entitlement offer at $13.00 per share, a substantial 17% discount to the closing price of Origin shares yesterday.

It will be conducted via a brand new equity raising structure, which comprises an accelerated institutional offer and a retail entitlement offer that includes the ability to trade these entitlements on the ASX.

This model, known as the Pro Rata Accelerated Institutional, Tradeable Retail Entitlement Offer (PAITREO), was developed by Merrill Lynch in consultation with Origin.

Part of the proceeds will be used to refinance debt used to fund the $3.26 billion purchase of the Integral Energy and Country Energy retail businesses and related assets, which closed on March 1.

Origin managing director Grant King said this purchase “establishes Origin as Australia's largest energy retailer, with around 4.6 million customer accounts and one of the country's largest and most flexible generation portfolios.”

He added that the company plans to separately consider funding options for Australia Pacific LNG, its 50:50 coal seam gas to liquefied natural gas joint venture with ConocoPhillips.

ORG shares stayed flat on Tuesday at $15.660.

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Tags ASX:ORGequityOrigin Energycapital raisingMerrill Lynch

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