👉 Background: Origin Energy is one of the Big Three in the power and gas industry - made up of Origin Energy, AGL Energy and EnergyAustralia. And Origin has over 4 million customes in Australia.

👉 What happened: Now, a group led by Canadian investor Brookfield has offered to pay over $18 billion for the company… or $9 per share. That’s nearly a 55% premium on Origin Energy’s last closing share price

👉 What else: If the Brookfield name sounds familiar, it's because it’s the same company that put in an $8 billion bid for AGL with Mike Cannon Brookes earlier this year. But with that juicy acquisition premium being offered, it would be hard for Origin’s board and shareholders to say no.

What's the key learning?

💡An acquisition premium is the difference between the last trading value of a company - set by the share market - and the price paid to acquire the company.

💡In the case of Origin, Brookfield and friends is offering a 55% acquisition premium. Brookfield failed in its last attempt to acquire AGL, so clearly they really want to close this deal.

💡And it’s no surprise that Origin Energy’s share price bounced over 36%. But if Origin’s board or shareholders to reject this mega-offer, that ‘premium’ value will drop off their company value almost immediately.

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