Banks sign up for asset sales

The Treasury has appointed three investment banks as joint lead managers for the sale of a minority stake in power generator and retailer Mighty River Power.

The companies are First New Zealand Capital/Credit Suisse Australia, Macquarie Capital New Zealand and Goldman Sachs New Zealand

They will be responsible for project management, consultancy, execution and advisory services for the initial public offer (IPO), Treasury said.

The Treasury has also appointed Bell Gully as its legal advisor.

The Government has said it expects to proceed with the sale of up to 49 per cent of the company later this year.

Firms not successful in the tender for work on the Mighty River Power sale would be able to compete for roles in subsequent transactions.

The Treasury has appointed a panel of six firms that can potentially act in future asset sales. The other three are UBS New Zealand, Forsyth Barr/Merrill Lynch, and Deutsche Bank/Craigs

Treasury said it would now look to contract "high quality broking firms and other distributors with channels to retail investors" to take a lead role in achieving widespread New Zealand ownership of Mighty River Power.

Details of the fees paid to the lead managers have not been revealed but will be disclosed in the offer documents before the IPO.

Treasury said three firms were appointed because the IPO was a substantial transaction and would likely require greater capacity than could be provided by a single firm.