Rt Hon John Key
Prime Minister

4 March 2013

Prime Minister - Mighty River shares readied for sale

Prime Minister John Key today confirmed the Government will offer the public up to 49 per cent of Mighty River Power in the second quarter of this year – subject to market conditions.

“This will begin tomorrow, with the opening of the process for investors to pre-register their interest in finding out more about the Mighty River Power share offer,” says Mr Key.

The Supreme Court last week dismissed challenges by the Māori Council and others to the Government’s sale of a minority shareholding in Mighty River Power. This follows the High Court reaching the same decision late last year.

“It means we can now proceed with offering a minority share in Mighty River Power.

“The Government’s share offer programme is an important policy. It is expected to free up $5-7 billion that we can then invest in other assets such as modern schools and hospitals, without having to borrow in volatile overseas markets,” says Mr Key.

“Under the share offer programme, New Zealanders will be at the front of the queue. They will have an opportunity to invest in big Kiwi companies at a time when they are telling us they want to diversify their savings away from property, bank deposits and finance companies.”

Cabinet today made a number of decisions about the timing and details of the Mighty River IPO.

These include:

• The Order-in-Council decision was taken to remove Mighty River Power from the SOE Act.
• A pre-registration process for New Zealand retail investors interested in finding out more about Mighty River Power shares will open tomorrow (5 March 2013) and run though until 22 March, around three weeks.

• The offer period is expected to open in mid-April and run for three weeks. The share offer document will be available at that time.
• Details of a loyalty bonus for New Zealand retail investors will be announced before the offer period starts.
• When the offer period closes, the institutional book-build takes place. Ministers then make share pricing and allocation decisions.
• We then expect that Mighty River Power will list on the sharemarket.

“My expectation is that, subject to market conditions, this process will be completed in mid-May, most likely before the Budget,” says Mr Key.

“The Mighty River Power share offer has been designed to achieve widespread New Zealand ownership. We envisage that, with the Government’s majority shareholding, total New Zealand ownership will be 85-90 per cent of the company after the share offer.

“From the Government’s perspective it makes sense to use this opportunity to reorganise the Government’s assets and redeploy capital to priority areas without having to borrow more.

“We intend to make it as easy as possible for New Zealanders to get access to information, register their interest and apply for Mighty River Power shares.”

ENDS

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