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


Infratil reaps $392 mln profit on sales of 20% of Z Energy

Infratil reaps $392 mln profit on sales of 20% of Z Energy

By Jonathan Underhill

Oct. 1 (BusinessDesk) - Infratil will book a profit of $392 million on the sale of its remaining 20 percent stake in Z Energy and said it will use the funds to pursue growth opportunities.

Infratil sold the 80 million shares at $6 apiece following a bookbuild in which the New Zealand Superannuation Fund sold 9.7 percent , or 38.9 million shares at the same price, leaving the fund with about 10 percent of Z. Infratil's profit, which is subject to finalisation of its share of Z's earnings for the six months ended Sept. 30 and sale costs, came from total sale proceeds of $479.2 million after costs and doesn't take into account dividends collected along the way.

The sale price was at the bottom of the $6 to $6.20 range in which the shares were offered and compared to Z's record-high close of $6.63 on Tuesday, when the sale was announced. Z shares have gained 51 percent in the past 12 months

Chief executive Marko Bogoievski said while Infratil was a supporter of the Z Energy business and its proposed acquisition of Chevron New Zealand, "the current market provided an opportunity for a clean exit and the flexibility to recycle capital into new growth opportunities."

Infratil and NZ Super Fund paid about $696 million for Shell New Zealand in 2010, funded with cash and debt, and transformed the former Shell downstream and retail business into Z Energy. They sold down their holdings to 20 percent apiece in an initial public offering of Z in 2013 at $3.50 a share, raising $840 million. Infratil's net proceeds from the IPO were $396 million.

Infratil released revised guidance for the year ending March 31, 2016, to reflect the the loss of earnings from its share of Z. Forecast earnings before interest, tax, depreciation, amortisation and fair value changes are cut to a range of $500-$530 million from a previous range of $520-$550 million. Operating cash flow is now expected to be $250-$280 million from $270-$300 million.

Following the sale of its Z stake, Infratil's net debt is about $310 million, made up of $989 million of infrastructure bonds, other drawn debt of $74 million and cash of $753 million.

"Infratil will continue to assess the full suite of capital management alternatives against ongoing opportunities for new investment and report on any decisions as that assessment is completed," Bogoievski said. The diversified investor, which is managed by Wellington-based investment bank HRL Morrison & Co, will provide a further update with its first-half results on Nov. 11.

Infratil shares last traded at $3.06 before being halted for the transaction and have gained about 17 percent in the past year.


© Scoop Media

Business Headlines | Sci-Tech Headlines


RNZ: Porirua Most Expensive Region To Rent, According To Trade Me

A rental website shows this town is now New Zealand's most expensive region to rent a house, ahead of Wellington and Auckland cities. More>>


Stats NZ: Nearly 1,000 More Big Businesses Now Than Two Decades Ago – Media Release

There are now 2,690 big businesses in New Zealand employing more than 100 staff – nearly 1,000 or 58 percent more than 20 years ago, Stats NZ said today. Over the 20 years to February 2020, the total number of enterprises in New Zealand increased ... More>>


RNZ: Housing Boom Could Get Worse, Economist Warns

Economists are calling on the Reserve Bank to reinstate lending restrictions, warning the housing market is spiralling out of control. More>>


Westpac: Sets Out Plan To Go Cheque-Free

Westpac NZ has announced details of its plan to phase out cheques, after signalling in May that it would be supporting a move to other forms of payment. Cheques will cease to be available as a means of payment after 25 June 2021. Westpac NZ General ... More>>


NZTA: Major New Zealand Upgrade Programme Projects Go To Tender

Two major New Zealand Upgrade Programme projects are beginning tenders for construction. The New Zealand Upgrade Programme is a $6.8 billion investment to get our cities moving, to save lives and boost productivity in growth areas. The first Auckland ... More>>

Reserve Bank: RBNZ Seeks To Preserve Benefits Of Cash

The Reserve Bank – Te Pūtea Matua is taking on a new role of steward of the cash system “to preserve the benefits of cash for all who need them”, Assistant Governor Christian Hawkesby told the Royal Numismatics Society of New Zealand annual conference ... More>>


CERT NZ: Malicious Computer Virus Targeting New Zealanders

CERT NZ, the government agency which supports organisations and individuals affected by cyber security incidents, says a recent surge of increasingly sophisticated malware attacks is affecting everyday New Zealanders as well as large organisations. The ... More>>


Economy: NZ Small Business Recovery Continues In September

Xero, the global small business platform, today released its Small Business Insights (XSBI) for September revealing an uptick in small business jobs and year-on-year revenue growth in New Zealand. Nationwide, the average number of jobs in the small ... More>>


Courts: Businessman Eric Watson Sentenced To A Four-Month Jail Term

New Zealand businessman Eric Watson has been sentenced to a four-month jail term in the UK for contempt of court, TVNZ reports. More>>

OECD: Area Employment Rate Falls By 4.0 Percentage Points, To 64.6% In Second Quarter Of 2020

The OECD area employment rate – the share of the working-age population with jobs – fell by 4.0 percentage points, to 64.6%, in the second quarter of 2020, its lowest level since the fourth quarter of 2010. Across the OECD area, 560 million persons ... More>>

Spark: Turns On 5G In Auckland And Offers A Glimpse Into The Future Of Smart Cities

Spark turned on 5G in downtown Auckland today and has partnered with Auckland Transport (AT) to showcase some of the latest in IoT (Internet of Things) technology and demonstrate what the future could look like for Auckland’s CBD with the power of 5G. 5G is ... More>>

Stats NZ: Monthly Migration Remains Low

Since the border closed in late-March 2020, net migration has averaged about 300 a month, Stats NZ said today. In the five months from April to August 2020, overall net migration was provisionally estimated at 1,700. This was made up of a net gain ... More>>