UBS, financial advisor to Australian Stock Exchange-listed Babcock & Brown affiliate Babcock & Brown Power, has received unsolicited bids for the company's whole and individual assets. No details were disclosed as to the offers or identities of the bidders.
The company will also suspend distributions until it is recapitalised, Babcock & Brown Power independent chairman Len Gill said in a statement.
UBS was selected in August to conduct a strategic review of Babcock & Brown Power, whose assets include interests in 12 operating power stations and two power stations under construction. The company's shares have dropped more than 95 percent this year and as a result its board has told UBS to seek a full range of transaction alternatives to realise shareholder value.
The next phase of the review will assess capital market conditions and the appetite of various parties to proceed with potential deals.
The deals could take the form of a sale of 100 percent of the securities in Babcock & Brown Power to a third party, more asset sales in strategic packages or structured transactions that would address Babcock & Brown Power’s gearing and corporate structure, the company said.
BBP's review process follows the footsteps of its manager, Babcock & Brown, which undergoing its own strategic review process. As a result of the process, it has already opted to wind down its corporate and structured finance division, sell its management agreement and ownership stake in satellite fund Babcock & Brown Communities and made high-profile management changes, such as the resignation of Phil Green, its former chief executive officer.
Babcock & Brown Power declined to comment.