Tauranga Consumer Trust sells 20M Trustpower shares for $154.8M

Thursday 23rd April 2015

Trustpower shareholder Tauranga Energy Consumer Trust sold 20 million shares in the power company for $154.8 million as it aims to diversify its investments away from a sole holding in the power company.

The trust reduced its stake to 26.8 percent from 33.2 percent after receiving a mandate from its consumer owners in 2013 to sell down this portion of its holding. Most of the shares were sold to New Zealand institutions and retail investors, with a small amount bought by Australians. The price of $7.74 is a discount to Trustpower's $8.08 closing price yesterday. The shares were halted today pending confirmation of the sale.

Established in December 1993, the trust uses income and capital from its Trustpower holding to benefit its 56,000 Trustpower account holders in Tauranga City and Western Bay of Plenty. It pays an annual distribution direct to consumers and also gives grants to the local community. The sale will allow it to maintain a cornerstone shareholding in the power company while diversifying its investment.

"It's purely a decision based on diversifying our investment portfolio," Wayne Werder, general manager of the trust, told BusinessDesk. "Trustees are working through reinvestment options, which is likely to be some form of diversified portfolio.

"We have maintained our 26 percent interest in Trustpower which maintains our influence in the company," Werder said. "There's no plans to sell any more shares. Our Trust is still very much committed to Trustpower."

The Consumer Trust is hopeful the sale of its shares will boost liquidity in Trustpower stock, more than half of which is owned by infrastructure investor Infratil.

BusinessDesk.co.nz

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