Australian Gas Light Company, the nation's biggest energy retailer, has said that it has agreed to acquire Pulse Energy Pty for A$880 million ($495 million), giving it more than a quarter of the nation's energy market.
Australian Gas said it will sell A$325 million of new shares to help pay for retailer Pulse and affiliates Edgecap and Utili- Mode. Pulse is being sold by a group including Royal Dutch/Shell Group, Kansas City-based Aquila Inc. and United Energy Ltd.
Buying Pulse will make the Sydney-based company the largest energy supplier in Victoria, Australia's second-most populous state, boosting revenue by a quarter and giving it 3.1 million customers nationwide, twice that of its nearest rival.
“To be able to get a leading market presence in Victoria enables Australian Gas to become the dominant player across the nation,” said Andrew King, who holds Australian Gas shares among the A$900 million of securities he helps manage at Investors Mutual Ltd. in Sydney. He said he will take a look at the share sale.