APA Group has acquired an interest in the debt of Basslink‘s borrowing entity, Nexus Australia Management, giving the Australian energy infrastructure player the opportunity to work with Basslink’s receivers and managers, according to a statement filed to SGX Monday.
Rob Wheals, APA’s CEO and managing director, said the potential acquisition of Basslink was in line with his company’s strategy to expand in the electricity transmission sector and to invest in renewable energy sources.
“The acquisition of the debt interest in Basslink demonstrates APA’s commitment to supporting this critical energy infrastructure so that it can continue to deliver reliable interconnected electricity between Tasmania and Victoria, and into the National Electricity Market,” Wheals said in the statement.
APA Group said Monday it had acquired Basslink debt with a face value of around A$99 million at a discount.
Basslink owns and operates a high-voltage, direct current electricity interconnector between Victoria and Tasmania. The interconnector assists in protecting Tasmania against the risk of drought-constrained energy shortages, while providing Victoria and southern states with renewable energy during peak demand periods.
Earlier this month, Basslink, which was a wholly owned subsidiary of Keppel Infrastructure Trust, had entered voluntary administration after on-going disputes with customer Hydro Tasmania and an unsuccessful attempt to sell the company.
At the time, Keppel Infrastructure Trust had said there was no contractual recourse to the trust under Basslink’s financing arrangements.
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.