Vector Selling its non-Auckland Gas Transmission and Distribution Business to First State Funds for $952million
Vector, the electricity and gas network operator is selling its assets in non-Auckland gas transmission and distribution business to First State Funds, an Australian investor for NZ$952.2 million. The company is focusing majorly in areas which are not subjected to price regulation and the sale comes after a strategic review.
The buyer, First State Funds is an infrastructure investor which has assets worth $7 billion in Australia, Europe and New Zealand.
Vector will get a net gain of approximately NZ$167million from the deal. Simon Mackenzie, the company's chief executive said "Vector believes this is a great outcome, further strengthening our balance sheet to fund organic growth in Auckland and pursue attractive unregulated growth."
The regional gas transmission business run by Vector covers an area of 2,200 kilometers or more. It includes pipelines which transports high pressure gas in 233 stations along with. It also has non-network assets in addition to distribution networks in almost all large cities and towns in North Island of New Zealand.
However, the sale still needs approvals from the Overseas Investment Office and ministers as well as the share holders of the company. A meeting expected in December and the deal is likely to be settled by the end of March in the coming year.
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