Vector completes purchase of controlling interest in NGC

Vector has installed its own board of directors at NGC appointing chairman Michael Stiassny, Greg Muir, Brian Plimmer and chief executive Mark Franklin, to join NGC's existing three independent directors, Richard Bentley, Rick Bettle and Fran Wilde.

Under the takeovers code, Vector is required to make a takeover offer for the full 100% of NGC. The remaining third of NGC shares are currently listed on the stock market.

Vector plans to float up to 24.9 per cent of itself in an initial public offering next year, hoping to raise at least $500 million to help pay for the NGC takeover.

NGC shareholders may be offered those special rights in a second offer - likely if Vector fails to reach the 90 per cent threshold needed for compulsory acquisition of all shares.

Mr Stiassny said the purchase price paid to AGL was NZ$2.91 per share. The current offer to all NGC shareholders closes on February 4.

Vector has promised its own offering will take place within 12 months.

Vector is the largest owner and manager of network infrastructures in New Zealand and is wholly owned by the Auckland Energy Consumers Trust, though it may seek listing on the stock market once it floats.

Vector holds $3 billion of assets and has annual revenue of over $550 million. It holds 35% of the New Zealand electricity market with 646,000 electricity consumers.

Vector holds 16% of the Auckland gas market with 72,000 consumers. It also has 200 km of fibre optic high-speed broadband voice and data communications in the Auckland and Wellington regions.

Mr Stiassny said NGC assets would not only enhance Vector’s strategic position, but also continue to play a major role in the country’s energy industry.

AGL has controlled NGC for six years. AGL originally bought a third share of NGC in 1992 and then won control in 1999.