Mike Cannon-Brookes emerges as new Sun Cable Owner

Mike Cannon-Brookes has prevailed as the winning bidder for mega solar project Sun Cable, after a 5 month long administration process left his investment vehicle – Helietta Holdings – agreeing to acquire Sun Cable’s assets. The billionaire climate activist is taking on the unprecedentedly large project with Quinbrook Investment Partners. The consortium managed to beat out Andrew Forrest’s Squadron energy, and while the price is still undisclosed – it’s understood to be less than $100 million.

Mike Cannon-Brookes has prevailed as the winning bidder for mega solar project Sun Cable, after a 5 month long administration process left his investment vehicle – Helietta Holdings – agreeing to acquire Sun Cable’s assets. The billionaire climate activist is taking on the unprecedentedly large project with Quinbrook Investment Partners. The consortium managed to beat out Andrew Forrest’s Squadron energy, and while the price is still undisclosed – it’s understood to be less than $100 million.

Sun Cable will be the world’s largest solar energy infrastructure network, and is planning to utilise one of the world’s most reliably sunny regions to build a gigantic 20GW solar farming operation that feeds into a 42GWh battery.

Situated in the Northern Territory with an estimated capital expenditure of around $30 billion, the energy will be transported to Darwin and then on to Singapore through a 5,000km cable system that the company has called the ‘Australia-Asia PowerLink’. Construction was expected to begin in 2024, with the project coming online in 2027 and creating over 14,000 jobs during its lifetime.

The exact circumstances in which Cannon-Brookes won the auction aren’t completely clear. There have been suggestions that after Forrest’s team of analysts, which included restructuring specialists McGrathNicol, did not immediately pull out of the bidding process after determining Squadron’s plans to use the Sun Cable to power hydrogen production were unviable – for fear of reducing the project’s value. However, Forrest was seen buying out most of Sun Cable’s creditors in March, and there are many suggestions that he was putting forward meaningful proposals.

There has been significant debate over what exactly should be done with all the electricity Sun Cable will produce. The falling out between Mike Cannon-Brookes and Andrew Forrest, who was also a bidding contender and shareholder, centred around the idea of exporting clean energy to Singapore through a 4,200km underwater cable, after it had already travelled 800km to Darwin

Selling Singapore on the power is still something that will have to be done, but it’s certainly not impossible. Energy security from a stable western nation is something that the city-state would look fondly upon, given their proximity to Malaysia and Indonesia. While Singapore has only  joined the net zero by 2050 club last year, they have had a carbon taxation scheme in place since 2019 – that they have proposed be increased to US$25/ton in 2024 and up to US$80/ton by 2030

Forrest is a long time advocate of the viability of hydrogen as an energy source. He questioned if the Sun Cable project – of which he was a cornerstone investor in their March 2022 $210 million raise  – is still viable, but also if Singapore even wants the power. Forrest attempted to scrap the 4,200km underwater cable that could have provided 15% of Singapore’s energy needs. He came out with an unexpected (but not necessarily unpredictable) plan to use the energy Sun Cable will harness to produce green hydrogen and ammonia. He also wanted to replace management, and proposed a convertible note deal that would have heavily diluted existing shareholders.

Cannon-Brookes has consistently advocating for the cable and the project as a whole. He stepped in with a $65 million emergency financing package in the form of a zero interest loan when Sun Cable entered administration in January, a move that was no doubt looked upon fondly by its administrators FTI Consulting and advisers Moelis.

This final transaction concludes the administrative process and will result in all creditors, mainly Twiggy, being paid off in full. It’s now up to Mike Cannon-Brookes and Quinbrook Infrastructure Partners to breathe some life into the most daring play the clean energy transition has seen, so far.

Past performance is not a reliable indicator of future performance.

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