Proposed Return Of Capital To Horizon Shareholders

Horizon Energy Distribution Limited has today applied to the High Court in Auckland for orders sanctioning an arrangement for the pro-rata return of excess capital to its shareholders.

The arrangement proposes that three in every four shares in the Company be cancelled and that each shareholder be paid $6.77 for each share previously held by that shareholder and subsequently cancelled in accordance with the arrangement. The Company expects to return approximately $101.5 million to shareholders and to cancel approximately 15 million shares under the terms of the arrangement.

Subject to the approval of the Court, shareholders will be asked to approve the arrangement at a shareholders' meeting scheduled for 26 August 1999. If approved by at least 75% of shareholders the arrangement will be binding on the Company and all shareholders.

Following the proposed payout to shareholders, which is expected to be made by the end of October, the Company's gearing will increase to approximately 62% compared with 13% at present.

Company Chairman, Colin Holmes said the proposed arrangement was seen by directors as being the most equitable way to effect the return of capital both from the point of view of the Company and of all its shareholders.

The return of capital follows the sale of the Company's energy business at the end of March.

ENDS....

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