Australia‘s biggest carbon emitter AGL abruptly announced on Monday the departure of its chairman, CEO and a string of board members, while scrapping a long-planned move to spin off its lucrative coal business.
In a statement to investors, the company said Peter Botten would resign as chairman and Graeme Hunt would step down as CEO when a replacement is found.
Operations at AGL — Australia’s largest energy company — have been under fierce scrutiny since billionaire green activist Mike Cannon-Brookes tried to buy the firm for about $6 billion.
AGL rejected the bid in March, saying the offer was “well below the fair value of the company”.
Cannon-Brookes, a 42-year-old tech mogul, launched his audacious bid to acquire the company in order to shutter its highly-polluting coal-fired power plants and repurpose the network to focus on renewables.
He had opposed a “demerger” of AGL’s coal and retail business, saying if it was allowed to be spun off his takeover would no longer make sense.
Australia is one of the world’s largest producers of coal and gas, and during a decade of conservative rule backed the building of new fossil fuel projects.
But Australians — hit by a series of intense droughts, floods and bushfires — overwhelmingly support more action to tackle climate change and recently voted in a centre-left government to do just that.
Cannon-Brookes described the news as a “huge day for Australia” and said there was a “better, greener path ahead”.
It was also welcomed by environmental group Greenpeace, who said AGL’s outgoing leadership had “failed to understand the shifting political landscape towards climate action.”
Monash University Energy Institute Director Ariel Liebman said preserving the company whole could help Australia pivot away from fossil fuels.
“The abandonment of the demerger is a great outcome not only for AGL shareholders, as it will preserve shareholder value, but also for energy consumers and Australia’s transition to renewable energy,” he said.
A split company would have had less clout to raise financing for renewable projects and more incentive to keep coal and gas generators.
“AGL Energy, in its current state, can manage an accelerated retirement of its coal and gas fleet in a much more orderly manner,” he added.
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