In a $2.7B deal AGL has taken control over Tilt Renewables. The deal between Powering Australian Renewables (PowAR) a futures fund, which is 20% owned by AGL will buy Tilt Renewables.

Queensland Investment Corporation (QIC) is also a partner in PowAR. The futures fund together with Mercury NZ, paid $NZ7.80 per share in cash for Tilt Renewables. Tilt Renewables is a New Zealand company,  which owns wind and solar farms in both Australia and New Zealand.

The PowAR and Mercury consortium outbid APA Group, Canadian pension fund Caisse de dépôt et placement du Québec (CDPQ) and Australian fund manager, Infrastructure Capital Group which is associated with Engie.

PowAR will take Tilt’s Australian portfolio of projects, while Mercury NZ will take over the New Zealand business.

As Mercury NZ is currently a partial owner of Tilt Renewables with a 19% share they have been committed to the sale. The majority owner Infratil, with a 65.5% stake in the business has also  committed to supporting the sale.

The deal, which will make PowAR the largest owner of wind and solar generation in Australia, was funded by $341 million from AGL.

AGLs Chief Executive Brett Redman described the deal as “an exciting opportunity for PowAR to further extend its leadership in renewable energy generation”.

As the largest owner of coal fired generation in Australia, AGL will use this deal to complement its recent acquisitions of commercial solar companies Epho and Solgen. This will allow the company to move towards its climate commitments.