By Phil Boeyen, ShareChat Business News Editor
Monday 28th May 2001
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The report comes in the wake of notices from several interests who have indicated they want to increase their holding in the company.
US-based Alliant, utilities investor Infratil (NZSE: IFT), and Tauranga Energy Consumers Trust all want to up their stake, while The Australian Gas Light Company (AGL) is looking to take 100%.
Alliant and the Tauranga-based trust have indicated offers between $3.20 and $3.60 for more shares while Australian Gas Light's offer is in a range between $3.30 and $3.60.
The report states it has valued TrustPower primarily by valuing each of its major business units on an unbundled basis, principally using the discounted cash flow approach, which it has tested against comparable market transactions.
"Our primary valuation approach has been cross checked against the value arrived at using conventional comparable company analysis, which is significantly lower," the report says.
Taking both approaches together the report says the fair market value for the company's shares are between $3.23 and $3.62.
The report also says there are prospects of bidding competition between the parties that have issued notices.
"Various scenarios could emerge including the securing of control by Alliant an Infratil via the AGL parcel, or a continuing absence of outright control by any company.
"Furthermore there is a good prospect that one or more unrelated parties may emerge to bid for full control of TrustPower at prices beyond our assessed fair value range."
TrustPower shares have been trading Monday above $3.50.
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