Reuters New Zealand
NZ approves Vector asset sale to HK's Cheung Kong
Wednesday July 16, 12:24 PM
WELLINGTON, July 16 (Reuters) - New Zealand has approved the sale of a NZ$785 million ($604 million) electricity network by Vector Ltd (NZX: VCT.nz) to Hong Kong's Cheung Kong group, the finance minister said on Wednesday.
Michael Cullen said approval was granted because the sale of the electricity network in the country's capital, Wellington, to Cheung Kong Infrastructure 1038.HK and Hongkong Electric Holdings 0006.HK did not involve any sensitive land.
"As a result, none of the national interest tests that were the subject of discussion over Auckland International Airport earlier this year applied in this case," Cullen said in a statement.
In April the government refused to allow Canada's state pension fund to buy 40 percent in Auckland International Airport Ltd (NZX: AIA.nz) because it was regarded as a strategic asset.
Shares in Vector, the country's largest electricity and gas supplier, last traded down 0.5 percent at NZ$1.98 in a broadly weaker market.
The stock, 75 percent owned by an Auckland consumer trust, has fallen 10 percent this year compared with a 26 percent drop in the benchmark top 50 .NZ50 index.
Vector chairman Michael Stiassny has said the funds from the sale will initially be used to pay off around NZ$700 million in bonds that mature this year.
Cheung Kong Infrastructure and Hongkong Electric, both part of the Cheung Kong group, will each own 50 percent of the Wellington network, which covers 162,000 consumers. ($1=NZ$1.30) (Reporting by Kazunori Takada, Editing by Mark Bendeich)
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