The Duet Group has launched a $1.4 billion takeover for landfill gas producer Energy Developments

Spencer Platt/Getty Images

Utility investment group Duet is buying Energy Developments, a remote and clean power specialist, in a $1.4 billion deal.

The companies have agreed that Duet will pay $8 cash for each Energy Developments share, a 17% premium to the six-month average price.

This gives Energy Developments, which produces gas from landfill sites, a market capitalisation of about $1.407 billion.

Duet has launched a fully underwritten $1.67 billion equity raising to fund the acquisition.

Energy Developments major shareholders Greenspark Power Holdings Limited (67.1%), Investors Mutual Ltd (9.6%), Coopers Investors Pty Ltd (4.6%) and other shareholders (4.4%) have indicated support for the deal.

Energy Developments today also increased its 2015 full year guidance to earnings of $218 million from the previous range of $211 million to $216 million.

Duet shares are in a trading halt. Energy Developments shares were up almost 3% to $7.95.

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