Genesis Energy will be the last asset to float - Key

HAMISH RUTHERFORD
Last updated 17:29 24/02/2014

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The Government is to proceed with the partial sale of Genesis Energy in the coming weeks then call time on the asset sales programme.

Prime Minister John Key said Finance Minister Bill English would outline more on the sales process in a speech on Wednesday. The sale would take place in the next "month or so".

But Key said the Government had decided that Genesis would be the last of the sales, with no other companies ideal for the mixed-ownership model.

"Genesis will be the last state-owned enterprise to be floated by the National-led Government," Key said this afternoon

He wanted to be "clear to New Zealanders" about what to expect, he added.

"This Government has been absolutely open and transparent in making commitments to New Zealanders and then sticking to them," he said.

"The Government won't be selling any more shares in SOEs or mixed-ownership companies either this term or after the election.

"In other words this will be the end of the share offer programme."

Part of the reason he was able to call time on the programme was that there was nothing much else appropriate for sale, Key said.

"The truth is there aren't a lot of other assets that would fit in the category, where they would be either appealing to take to the market or of a size that would warrant a further programme, or they sit in a category where they are very large, like Transpower, but are a monopoly asset and so aren't suited, I don't think," Key said.

He wanted to make a clear commitment, in part so voters "aren't misinformed by our political opponents that, somehow, there is going to be further asset sales or mixed-ownership companies. That won't be the case."

The Government last year sold 49 per cent stakes in Meridian Energy and Mighty River Power and a smaller stake in Air New Zealand, which was already partially owned by the public.

Key refused to give further details of the Genesis sale, saying he would leave this to English.

Late last year the Government slashed the amount it expected to raise from asset sales, although this included a reduction after Solid Energy, once expected to raise about $1 billion, was withdrawn from sale as it came close to collapse after an ill-fated expansion.

The new target is $4.6b-$5b, which excluding the funds already raised, implies that the Government expects to raise $600 million to $1b from the partial sale of Genesis.

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