By Stephen Mayne, small AGL shareholder

After last night’s audacious $900 million raid to snatch a 10% stake in AGL, Perth-based Alinta has this morning unveiled its merger proposal which involves the two companies getting together and then divorcing again to create separate listed energy and infrastructure businesses.

Demergers have been all the rage in recent years but I’ve never seen a hostile takeover proposal being predicated on then immediately separating the combined operation again.

At the moment, we have AGL and Alinta, two distinct companies, which was about to become three if AGL shareholders next month approved the ridiculously expensive $80 million separation of its energy and infrastructure assets.

Now Alinta has entered the fray and said it wants to keep the situation as just two companies but only after they pool their energy and infrastructure businesses with each other. It’s all very complicated and expensive shuffling just to get a better share market rating as energy stocks continue to boom.

AGL and Westpac are our two oldest listed companies, so the notion of a $2.8 billion Perth upstart, which only floated 6 years ago, launching a hostile takeover bid for a $9 billion giant, brings back memories of Robert Holmes a Court’s 1980s tilts at BHP.

The Big Australian was originally advised by an up and coming Graeme Samuel at Macquarie Bank and the Millionaire’s Factory is in the thick of all the current action.

AGL chairman Mark Johnson is one of the original founders of Macquarie Bank and still chairs its investment banking division. How does he feel about Macquarie advising Alinta to launch this hostile merger, presumably after Johnson told his Macquarie mates to get nicked?

AGL shares were trading at $14.50 before the merger proposal and were at $18.30 yesterday so it is hard to see what all these grumbling institutions are talking about, but they’ve clearly persuaded Alinta to fork out a tasty $900 million in cash for the lucky few.

AGL shares peaked at $19.70 this morning before settling back at $19.25 by lunch time, a rise of 90c for the day. Alinta remains suspended but expect their stock to weaken when it comes back on this afternoon.

Finally, it is interesting that Barclay Global Investors snapped up 5.2 million AGL shares on February 15, lifting its stake to 6.1%. And who is one of the two top brokers for Barclays? None other than Macquarie Bank, but the Chinese walls were presumably working brilliantly as usual.