Solar and storage developer Genex target of $300 million takeover bid

Genex Power confirmed on Monday it had received a takeover offer from a consortium comprising Atlassian co-founder Scott Farquhar’s private investment fund Skip Capital, and US equity firm Stonepeak Partners.

The confirmation came just hours before the Sydney-based renewable energy developer revealed it had achieved record revenue last financial year totalling more than $26 million.

Skip Capital, an investment firm founded by Farquhar and his wife, former Hastings Funds Management executive Kim Jackson, and Stonepeak have placed a 23 cent per share bid for Genex, representing a total valuation of more than $300 million.

“The Genex board has not yet formed a view on the merits of the indicative proposal or any potential further engagement with the consortium,” Genex said in a statement issued on Monday.

Genex confirmed that Skip Capital, through its Skip Essential Infrastructure Fund, has already built up a 19.99% stake in the renewable energy company after a series of transactions completed last week.

Genex’s portfolio of renewable energy generation and storage projects includes the $777 million Kidston Pumped Hydro Storage Project being developed about 270 kilometres north-west of Townsville in northern Queensland.

The 250 MW / 2,000 MWh pumped hydro facility is the centrepiece of what will become the Kidston Clean Energy Hub, which comprises the existing 50 MW Kidston Solar Farm, which Genex has been operating since 2017, while up to 270 MW of additional solar and up to 150 MW of wind generation have also been proposed.

Genex is also building the 50 MW/100 MWh Bouldercombe Battery Project in Queensland and operates the 50 MW Jemalong Solar Farm in New South Wales.

The takeover interest comes with Genex announcing on Monday that it had achieved record revenue last financial year and the first full year of positive operating cash flow in the company’s history.

In its latest quarterly report, Genex reveals that its two operating solar farms had brought in $26.1 million of revenue (unaudited) over financial year 2022 while its net operating cash flow reached $4 million.

“The value of our existing portfolio of renewable energy assets was highlighted during the period with both the Kidston Stage 1 Solar Farm and the Jemalong Solar Farm able to take advantage of the recent uplift in wholesale electricity prices, to secure record revenue and cash flow for the business,” Genex chief executive officer James Harding said.

Genex said during the quarter ending 30 June 2022, the Kidston Solar Farm revenue totalled $4.8 million from net generation of 26,334 MWh of renewable energy for the period, representing an average price of $182/MWh.

The Jemalong Solar Farm revenue totalled $3.8 million, including $3.0 million from electricity sales and $800,000 from the sales of renewable energy certificates (LGCs) from net generation of 17,044 MWh. This represented an average bundled price of $219 MWh, up 109% from the previous period.