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Takeover Offer for Powerco Limited

4 October 2004 NZX Announcement

Prime Infrastructure Networks (New Zealand) Limited – Takeover Offer for Powerco Limited Prime Infrastructure Networks (New Zealand) Limited (“PINNZ”) today announced that it has revised the terms of the Takeover Offer (“Offer”) in respect of Powerco Limited. The revisions accommodate the potential for additional cash funding by PINNZ in the circumstances set out in the Addendum (the “Addendum”) to the Takeover Offer Document (attached).

The revised Offer has been made to address concerns expressed by the New Plymouth District Council, Taranaki Electricity Trust Incorporated and Powerco Wanganui Trust Incorporated (the “Majority Shareholders”) regarding the market’s reaction to the possible impact of the interaction of the ‘Takeovers Code (Prime Infrastructure Networks (New Zealand) Limited) Exemption Notice 2004’ and the operation of the cash cap and scaling provisions of the Offer.

The revisions to the Offer provide for additional funding to be provided by PINNZ in circumstances where there is a high level of acceptances by Powerco shareholders or capital bondholders and where a significant proportion of those accepting are only eligible for cash consideration as a result of being ‘Priority Cash Recipients’ (as defined in the Addendum). Chris Chapman, Managing Director of Prime Infrastructure Limited, said that while he believed that the Majority Shareholders’ concerns may not eventuate, the parties concerned activated solutions to ensure a positive outcome for all Powerco and Prime Infrastructure shareholders. The Majority Shareholders have agreed to accept the Offer as amended by the Addendum in respect of the Combination Option set out in the Offer. The Majority Shareholders own 53.65% of Powerco shares, all of which are registered with New Zealand addresses.

“The Powerco acquisition is still expected to be immediately accretive for Prime Infrastructure on a cash flow per share and an EV / EBITDA multiple basis notwithstanding the potential for additional cash funding by PINNZ, as the additional cash funding would only be required at acceptance levels above 73.25%”, Mr Chapman said.

The Offer opened today, and shareholders and capital bondholders can expect to receive the Takeover Offer Pack by mail shortly. The Takeover Offer Pack will include the Takeover Offer Document and Addendum, a Key Information Summary, a combined Prospectus and Investment Statement, Takeover Offer Acceptance Forms and reply paid envelopes.


ENDS


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