Vector yesterday announced it was to aiming to snap up the 32.8% of the gas trader and reticulator it did not already own. But trading in NGC shares had been halted until Vector released details of its bid.
Now Auckland-headquartered Vector has said it will pay NZ$3.40 for each share – NZ$0.78 in cash and the rest in new shares that will have an issue price of NZ$2.62.
Trading in NGC shares, which last night jumped 22c to NZ$3.72 on news of the full takeover bid, also resumed today on the New Zealand Stock Exchange.
Vector - the largest owner and manager of energy infrastructure networks in New Zealand - said it would be seeking to issue 249 million new shares, being 24.9% of the company.
Money raised would be used to pay the debt incurred when it bought Australia Gas Light’s 66.05% stake in NGC last year (and the later additional 1.15% on-market purchase) and for further unspecified growth opportunities. It should list on the NZSX by spring, with a market capitalisation of up to NZ$2.38 billion.
Beneficiaries of the Auckland Energy Consumer Trust, which owns Vector, holders of Vector’s listed capital bonds and NGC shareholders will all have an opportunity to participate in the priority offers before the general public and institutional offers.
The capital bond and AECT offers opened today and close on August 1 and August 10 respectively. The public offer also opened today but closes on August 24. The NGC takeover offer opens on July 11 and closes on August 10. Vector shares are expected to start trading from August 26.
Last year, Vector board approval for the 24.9% sell-off was only given by two of the five trustees after John Collinge had been barred by a court order from voting on the deal. Chairman Warren Kyd later used his casting vote to get the partial privatisation approved.
Meanwhile, Standard & Poor's Rating Services (S&P) has placed NGC’s BBB+ rating on CreditWatch with negative implications.
S&P said the CreditWatch would be resolved once the Vector IPO had been successfully concluded and the outcome of the takeover offer for the remainder of the NGC shares was known.
NGC’s A-2 short-term ratings were affirmed, while S&P also placed Vector’s BBB+ long-term rating on CreditWatch with negative implications.
