Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Mighty River – uptake down, real estate love affair unbroken

News release

3 May 2013

Mighty River Power – uptake down, prices down, real estate love affair unbroken


Peter Sherwin, Grant Thornton New Zealand Partner, Privately Held Business, looks at the ramifications of the Mighty River Power asset sale which closes today


With applications for Mighty River Power (MRP) closing at 5pm today, a straw poll around the office indicates that the uptake on MRP shares will be lower than the Government first planned.

And if this comes true the sabre rattling by the Greens and Labour may have wiped as much as $400m off the value of the MRP listing by damping the enthusiasm of small investors.

Potential investors may now hold back due to confusion about the future of the power industry, uncertainty whether MRP will stag at a higher price and a fear the price will go down upon listing.

The lack of take up will dampen the listing price, which is more likely to be at the lower end of the scale, around $2.25 rather than the expected $2.80.

The Greens and Labour may have scored political points, but effectively they have slashed the Government’s cash investment to fund health, education and infrastructure programmes.

It will also ensure the Government’s desired “second investment front” remains unopened thereby leaving intact New Zealand’s love affair with the non-productive real estate sector.

So who pays the price for the opposition’s political gain? Every Kiwi, even those they claim to champion.

Professional and institutional investors will not be daunted by any of this and are making big offers, but with fewer "mum and dad" buyers they may not have to go to the market for as many shares when they are listed on 10 May 2013.

This is not panning out the way the Government envisaged and may spook their confidence for future asset sales although reports from The Wall Street Journal suggest the Treasury has called for investment banks to tender for leading roles in the partial privatisation of Meridian Energy and Genesis Energy.

Early trading on 10 May 2013 will be watched keenly by politicians, investors and mums and dads alike for all sorts of reasons and not everyone is going to end up happy…..but just which group is going to be disappointed is the billion dollar question.


ENDS


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

PGPs: New Programme Sets Sights On Strong Wool

A new collaboration between The New Zealand Merino Company (NZM) and the Ministry for Primary Industries (MPI), announced today, aims to deliver premiums for New Zealand's strong wool sector... More>>

ALSO:

Restrictions Lifted: No Further Tau Flies Found

The Ministry for Primary Industries (MPI) confirms that all restrictions on the movement of fruit and vegetables in Manurewa, Auckland, due to the Tau fly, have been lifted as of 2.26pm on Sunday 7 February. More>>

Crowdfinding: Awaroa Beach To Become Public Land If Appeal Succeeds

Conservation Minister Maggie Barry says a privately-owned beach will become part of the Abel Tasman National Park if an online crowdfunding campaign to buy it succeeds... More>>

ALSO:

Meat Workers Union: Waitangi Mondayisation Flaunted By Large Employer Of Maori

At the AFFCO Talley owned meat plant in Rangiuru, the company has resorted to bullying and threats... saying they could be disciplined and their union sued for an unlawful strike if workers exercise their rights to a paid day off tomorrow. More>>

Earlier:

ETS Review: Modelling Documents Released

Three technical documents are being released to help New Zealanders engage with the Emissions Trading Scheme (ETS) review, Climate Change Minister Paula Bennett says. More>>

ALSO:

Northland: Govt Plan Targets Transport, Web, Maori Assets

The government has released a 10-year plan to attract investors and lift economic growth in Northland, a region that perennially underperforms the rest of the country even while being endowed with natural beauty, productive land, minerals, a potential workforce, scope for manufacturing, forestry and aquaculture, and proximity to Auckland. More>>

ALSO:

Statistics: Unemployment Rate Falls To 5.3 Percent

The unemployment rate fell to 5.3 percent in the December 2015 quarter (from 6.0 percent), Statistics New Zealand said today. This is the lowest unemployment rate since March 2009. There were 16,000 fewer people unemployed than in the September ... More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news