UPDATE 3-Tilt Renewables agrees to $2.1 bln takeover, shares hit record

* Tilt valued at NZ$7.80/share

* Deal marks first major M&A activity in New Zealand this year (Adds Tilt share price, AGL statement)

March 15 (Reuters) - New Zealand’s Tilt Renewables Ltd said on Monday it would be acquired by a consortium including its second-largest shareholder and Australia’s AGL Energy Ltd for NZ$2.94 billion ($2.10 billion), sending its shares to an all-time high.

The deal was the first major piece of M&A activity in New Zealand this year, which comes amid a push from companies and investors for decarbonisation and a move towards clean, renewable energy.

Powering Australian Renewables (PowAR), a partnership between AGL, investment manager QIC and Australia’s sovereign wealth fund, will buy Tilt’s Australian business, while 19.9%-shareholder Mercury NZ Ltd will buy its New Zealand business.

The deal will give the consortium access to the New Zealand-based firm’s 20 wind farms that are operational or under development.

Tilt shares soared 18.1% to NZ$7.65 by 2146 GMT, but still traded below the consortium’s offer price of NZ$7.80 per share, which was a 20.4% premium to Friday’s close.

“The board is pleased that, with these new owners, the transition to renewables in Australia and New Zealand will continue to accelerate,” Tilt Chairman Bruce Harker said.

Infratil Ltd, Tilt’s largest shareholder, and Mercury NZ have agreed to vote in favour of the deal, the company said, adding that a meeting to vote on the agreement would likely be held in about four months.

In separate statements, Infratil said it expected to fetch about NZ$1.93 billion from the sale of its 65.5% stake in Tilt, while Mercury NZ said the deal would be immediately accretive and add NZ$50 million to its 2022 earnings.

AGL said it would contribute A$341 million ($264.5 million) to fund its portion of PowAR’s deal for Tilt’s Australian operations.

“The proposed acquisition by PowAR will provide more renewable energy options in AGL’s generation portfolio, further supporting our orderly transition away from coal-fired power and responding to our customers’ increasing appetite for cleaner energy,” AGL Chief Executive Brett Redman said.

($1 = 1.3974 New Zealand dollars)

$1 = 1.2893 Australian dollars Reporting by Shashwat Awasthi in Bengaluru; Editing by Edmund Blair and Peter Cooney