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

 


NZ plans to list Genesis Energy in April

NZ plans to list Genesis Energy in April after partial sale aimed at increasing pricing tension, English says

By Tina Morrison

Feb 26 (BusinessDesk) – New Zealand’s government will sell down 30 to 49 percent of its holding in Genesis Energy and list the power company on the nation’s share market in April, marking the end of its spate of partial asset sales over the past year as a general election looms.

Genesis shares will be priced at the start of the initial public offer period in March, in what is known as a front-end bookbuild, Finance Minister Bill English said in speech notes for delivery in Auckland today. That will provide more certainty for investors and allow sharebrokers to bid for the stock at the same time as institutional investors, creating stronger competition, English said.

New Zealand’s government has previously said it expected to reap between $700 million and $1.1 billion from the sale of 49 percent of Genesis, following on from last year’s partial privatisation of MightyRiverPower and Meridian Energy, and a reduction in its holding in national carrier Air New Zealand. So far, the government has raised about $4 billion, reducing its overseas debt requirements and helping fund schools, hospitals and faster broadband, English said today.

“The government won’t be selling any more shares in state-owned enterprises or mixed ownership companies – either this term of after the election,” English said, reiterating earlier comments by Prime Minister John Key. “We’ve achieved what we wanted to with the share offers in energy companies and Air New Zealand.”

The remaining state-owned enterprises are a combination of small entities, natural monopolies or companies in sectors that are unsuitable for future share offers, English said.

The government anticipates that selling a smaller stake in Genesis in a front-end bookbuild could increase the price by offering fewer shares to more bidders, English said. A decision on how much of the company is to be sold will be made ahead of the offer.

Genesis is the country’s largest power company by customer numbers but the smallest of the partial privatisations by asset value. New Zealand retail investors in Genesis will be offered loyalty bonus shares and a simpler investment statement detailing the offer, English said.

MightyRiverPower listed in May at $2.50 and recently traded at $2.06. Meridian’s instalment receipts listed in October at $1 and recently traded at $1.055.

Last week, Genesis reported a 23 percent slide in first-half earnings to $150.5 million, reflecting stiff retail competition and a warm winter, which meant hydro-storage was above average and wholesale prices were lower.

The partial privatisation programme has had mixed success after an opposition proposal to overhaul the electricity market saw traders discount the value of the power companies, accompanied by growing recognition that New Zealand has excess generation capacity that may last some years, keeping a lid on prices.

A general election has to be held this year.

(BusinessDesk)


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Season Ends: Is Whitebaiting Sustainable?

The whitebait fry - considered a delicacy by many - are the juveniles of five species of galaxiid, four of which are considered threatened or declining. The SMC asked freshwater experts for their views on the sustainability of the whitebait fishery and whether we're doing enough to monitor the five species of galaxiid that make up whitebait. More>>

ALSO:

Crown Accounts: Smaller-Than-Expected Four-Month Deficit

The New Zealand government's accounts recorded a smaller-than-forecast deficit in the first four months of the fiscal year on a higher-than-expected inflow of corporate and goods and services tax. More>>

ALSO:

On For Christmas: KiwiRail Ferries Back In Full Operation After Quake

KiwiRail’s Interislander ferries are back in full operation for the first time since the Kaikoura earthquake, with the railspan that allows rail wagons to be loaded on the Aratere now restored. More>>

ALSO:

Comerce Commission Investigation: Prosecutions Over Steel Mesh Labelling

Steel & Tube Holdings, along with two other companies, will be prosecuted by the Commerce Commission following the regulator's investigation into seismic steel mesh, while Fletcher Building's steel division has been given a warning. More>>

ALSO:

Wine: 20% Of Marlborough Storage Tanks Damaged By Quake

An estimated 20 percent of wine storage tanks in the Marlborough region, the country’s largest wine producing area, have been damaged by the impact of the recent Kaikoura earthquake. More>>

ALSO:

ACC: Levy Recommendations For 2017 – 2019 Period

• For car owners, a 13% reduction in the average Motor Vehicle levy • For businesses, a 10% reduction in the average Work levy, and changes to workplace safety incentive products • For employees, due to an increase in claims volumes and costs, a 3% increase in the Earners’ levy. More>>

Women's Affairs: Government Accepts Recommendations On Pay Equity

The Government will update the Equal Pay Act and amend the Employment Relations Act to implement recommendations of the Joint Working Group on Pay Equity. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news