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AECT welcomes VECTOR plan to grow share value


AECT welcomes VECTOR plan to grow shareholder value

The Auckland Energy Consumer Trust (AECT) today welcomed an announcement by VECTOR Limited that confirms the financing options for a full takeover offer of UnitedNetworks Limited.

The takeover, if successful, will see $2.3 billion in strategic electricity assets come back into New Zealand ownership.

Karen Sherry, chair of the AECT, said the transaction represents a triumph for all beneficiaries of the Trust.

"On the one hand, this transaction should ensure development of earnings for VECTOR, with growth over time for the Trust and our income beneficiaries. On the other hand, the expansion of VECTOR's business is good news for the Capital beneficiaries who will eventually be handed over the Trust's investments," Ms Sherry said.

A full takeover of UnitedNetworks will cost VECTOR around $1.5 billion, and Ms Sherry welcomed the announcement that the company has arranged sensible long-term funding options for the transaction - rather than relying solely on costly bank debt.

The Trust announced earlier this week that it has already preserved the rights of nearly 270,000 Auckland households and businesses in a landmark Deed agreed with VECTOR. The new deed enshrines essential operating requirements that must be provided for beneficiaries of the AECT by VECTOR, including spending of around $10 million a year to underground existing overhead electricity lines, a small customer pricing policy and a target dividend payout ratio to shareholders.

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