Media reports say EME may restructure its 51% stake in Contact through a convertible notes issue - a move some commentators say would enable it to raise enough money to keep American financiers at bay, while preserving its stake in an asset it values highly.

Contact's share price slumped to NZ$5.23 at the end of last week after Edison Mission chief executive Tom McDaniel resigned from the Contact board, saying he needed to devote significant time to implementing the EME restructuring plan.

His resignation just renewed speculation EME would sell or restructure its Contact stake - and perhaps some of its Aussie interests - to satisfy conditions attached to last November's securing of an US$800 million loan intended to provide "bridge financing to asset sales, including the sale of some or all of its international operations".

EME's Aussie interests include stakes in the Western Australia Kwinana gas-fired station and the Victorian coal-fired Loy Yang B plant. It also operates in the Philippines, Indonesia and Thailand. Credit Suisse First Boston has been appointed to handle the international sales process.

One analyst has been quoted as saying EME's intent with Contact is not to sell a prized asset, but to raise money to repay debt. Rather than have someone bid for the whole of Contact, as required under new takeover rules, EME could issue convertible notes which could later convert to Contact Energy shares.

Commentators are unsure whether EME will decide to sell off its worst performing international assets or its best. Contact spokesman Pattrick Smellie declined to comment to EnergyReview.Net about the rumours and referred ERN to EME's NZ public relations firm, Susan Wood and Associates, which has not commented either.

Meanwhile, Contact Energy comes out as a top performer in the 2003 New Zealand Wealth Creators Report.

According to the calculations by international consultancy Stern Stewart, Contact Energy created NZ$694 million of wealth and exceeded its cost of capital by NZ$514 million.

The future growth component of Contact's value was just under NZ$2 billion, which Stern Stewart said showed the market was impressed by its "strategy and sound management".

However, New Plymouth-headquartered electricity and gas network company Powerco scored a minus NZ$64 million in the report.