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Powerco completes “Jumbo” offer

Powerco completes institutional component of “Jumbo” offer

On 15 October 2002, Powerco announced a Priority Entitlement Offer to raise $150 million. The Priority Entitlement Offer is structured in two parts: the Institutional Offer; and the Retail Offer.

Powerco is pleased to advise that the Institutional Offer has successfully raised approximately $102 million of the Priority Entitlement Offer.

Based on the book build process for the Institutional Offer, the approximate entitlement ratio is 1 new Powerco share for every 2.37 Powerco shares held at the record date for the issue (5.00 pm on 18 October 2002). The subscription price is $1.60 per new share.

The balance of the Priority Entitlement Offer will comprise the Retail Offer. The Retail Offer is to be made at the same subscription price of $1.60 per new share, and on the same 1:2.37 (approximate) entitlement ratio, as the Institutional Offer. Entitlements under the Priority Entitlement Offer are non-renounceable.

The total number of new shares expected to be issued under the Priority Entitlement Offer is approximately 93.75 million.

An investment statement and prospectus will be mailed to all New Zealand registered holders of Powerco shares as at the record date on or about 4 November 2002 and that document will also be made available to members of the public wishing to apply for Powerco shares under the Priority Entitlement Offer.

The retail offer will open on 5 November 2002 and close on 29 November 2002.

The new shares will rank equally with existing Powerco shares except that the new shares will not confer any entitlement to the interim dividend of six cents per share to be paid on 25 November 2002. The expected date for the first payment of dividends on the new shares is June 2003.

Proceeds of the offer will be used to partially fund the proposed acquisitions of the electricity network business and assets of UnitedNetworks Limited in the Tauranga, eastern and southern Waikato, Thames and Coromandel regions, and the gas network business and assets of UnitedNetworks Limited in the Wellington, Manawatu, Horowhenua and Hawke’s Bay regions.

The purchase of these assets is subject to the approval by Powerco shareholders at a special meeting to be held in New Plymouth on 29 October 2002 and there being no material adverse change prior to completion of the acquisitions. Approval of UnitedNetworks shareholders for the divestment of the assets to Powerco was obtained at a special meeting of UnitedNetworks shareholders on 16 October 2002.

Comments from Powerco “We are pleased to complete the institutional component of the jumbo offer. The spread of institutional bids we have received is very encouraging and we welcome the new shareholders on to our register”, Powerco Chairman Barry Upson commented.

Powerco Chief Executive, Steven Boulton, commented “The proceeds of the jumbo offer will be used to partially fund the acquisition of various electricity and gas assets of UnitedNetworks Limited. The acquisitions will almost double the size of Powerco in terms of consumer connections and the resulting economies of scale will enable Powerco to continue delivering superior service levels and value to consumers and shareholders.”

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