Australia’s second-biggest electricity and gas retailer on Friday rejected a proposed $14 billion “merger of equals” with AGL, saying the deal did not reflect the fundamental value of the two companies.

But King on Sunday said while Origin had rebuffed the so-called nil premium proposal, it is open to more talks with AGL.

“We remain open to discussion with any party that wants to talk to the company about value-adding transactions,” King told ABC Television.

“We think the ball is firmly in AGL’s court.

“If they’d like to come back and have some further discussion, that’s a matter they need to consider.”

The two Sydney-based companies have a combined market capitalisation of about $14 million.

Origin last week acknowledged that there were potentially significant operational benefits and synergies from a merger with AGL, but noted a significant divestment of assets would be required, including Southern Hydro and Powerdirect.

AGL on Friday said it was “disappointed” with Origin’s rejection and “strongly disagreed” with a number of the company’s conclusions.

Meanwhile, commenting on the energy sector as a whole, King reportedly said the continued ownership by government of key assets was a structural impediment.

“Clearly, the price paid by companies like AGL and ourselves for retail assets, we would hope would be interesting to governments who own those assets,” AAP quoted him as saying.

AAP also reported that Origin is hoping to have talks with the next New South Wales Government about the possible privatisation of Energy Australia.

Meanwhile, Origin said it had completed the share purchase plan that was used to partly fund the company’s acquisition of wholesale business Sun Retail from the Queensland Government.

The company said applications from around 60,000 shareholders were received for $262 million in application funds, more than three times the target of $75 million.

“In accordance with the scale back policy, the maximum allocation has been set at 200 shares,” Origin said.

“Accordingly, all shareholders who applied for more than 200 shares will receive 200 shares and those that applied for 200 shares or less will receive the number for which they applied.

“Total funds raised have thereby been increased to $83 million.”

The price of Origin shares in the SPP was $7.10, the same as that paid by institutional investors in the equity placement last November, which represented about a 2.5% discount to the market price at that time.

Origin said the SPP price represented a 21% discount to its closing price of $9.05 on February 19, the day the SPP applications closed.

“The response to the share purchase plan has been outstanding and I would like to thank our shareholders for their support in the funding of the Sun Retail acquisition,” chairman Kevin McCann said.

“The strengthening of the Origin share price from the time of the institutional placement in November 2006 to the time of the SPP offer, increased demand beyond our expectation.”

Origin will today allot about 11.7 million shares to about 60,000 shareholders, while confirmation statements and refund cheques will be posted to shareholders around March 6.

The company said new shares will rank equally with existing ordinary shares and will be eligible to participate in all dividends, including the interim dividend for the half-year ended December 31, 2006.

Sun Retail has about 833,000 mass market and small business customers in the high growth corridor in southeast Queensland.