Powerco sale in doubt; B&B cites hitch
Powerco sale in doubt; B&B Infrastructure cites hitch
By Jonathan Underhill
Feb. 24 – The sale of a half stake in Powerco Ltd. is in doubt after Babcock & Brown Infrastructure said settlement of the deal has struck a hitch.
BBI was to have sold the Powerco stake to Australia fund manager QIC, under a deal that put an enterprise value of NZ$2.05 billion on the New Zealand business and was to provide net proceeds of NZ$400 million. Babcock planned to use the fund to repay debt.
“Issues have arisen which have created uncertainty relating to completion of the sale of an interest in the New Zealand business of Powerco,” Babcock said in a statement to the ASX. “BBI is working to resolve the issues but is not yet in a position to provide details of any outcomes.”
The infrastructure investor, an offshoot of Babcock & Brown, had its stock halted from trading pending the outcome of the sale. They last traded at 6.8 cents on the ASX.
Shares of BBI have slumped 95% in the past 12 months as it lined up assets for sales to reduce its debt burden. Other asset earmarked for sale included WestNet Rail and BBI Euroports.
Powerco is New Zealand’s second-largest electricity and gas distributor after Vector Ltd.