APA Group, an Australia-listed energy infrastructure player, confirmed Monday it is in talks about potentially acquiring Basslink from Keppel Infrastructure Trust (KIT).
On Sunday, Australia’s Financial Review reported APA Group was assessing ways to take control of the interconnector and the contract with Tasmania’s Hydro Tasmania.
In a statement, APA Group said it “has submitted a confidential, conditional and incomplete proposal to KIT regarding the potential acquisition.”
“While APA is in exclusive discussions, those discussions are ongoing and are incomplete and no definitive agreement has been reached between the parties in relation to any transaction,” APA Group said.
KIT said it has received the proposal from APA and that it is in ongoing, exclusive discussions.
“There is no certainty or assurance that the potential acquisition will materialise and Unitholders are advised to exercise caution when dealing in the units in KIT,” KIT said in a filing to SGX Monday. “As KIT does not rely on Basslink’s cash flows for its distributions, the foregoing is not expected to have any financial impact on the distribution per unit” for this year.
Basslink owns and operates a high-voltage, direct current electricity interconnector between Victoria and Tasmania.
Basslink has been problematic for KIT. In June, KIT said it would make an additional S$23.8 million provision for arbitration for the subsidiary related to disputes over the cable’s failure in 2015, The Business Times reported.