BG bids $12.9 billion for Australia's Origin Energy

UK-based energy utility BG Group (formery British Gas) has offered to acquire Origin Energy, the second  biggest electricity and gas retailer in Australia, for $12.9 billion in cash.

BG, the biggest importer of liquefied natural gas (LNG) into the US, has offered to take over Origin Energy for $14.50 a share, a 40 per cent premium to Origin's closing share price on Tuesday.

Origin said it had not yet considered the proposal and "discussions between the parties will take place,''  adding, it "may or may not lead to an agreed transaction.''

Origin supplies gas and electricity to over three million customers – domestic and businesses - across Australia, New Zealand and the Pacific.

BG also recently set up a joint venture with Queensland Gas Company Ltd to develop an $8 billion (A$664 million) LNG project on the Queensland coast. The coal seam methane venture will produce liquefied natural gas near the port town of Gladstone.

Origin, Australia's biggest coal seam gas producer, recently raised gas production by 22 per cent in the three months ended 31 December. It is also considering further hike in production.