Lines firm buyers to front up today

By CHRIS DANIELS

Prospective buyers of New Zealand's biggest electricity lines company, UnitedNetworks, have until the end of business today to make themselves known.

The North Shore-based company, which has a sharemarket value of $1.28 billion, was put on the block by United States energy giant Aquila, which wants to get out of its 70 per cent shareholding in the firm.

Aquila will either sell all its stake to someone wanting to launch a full takeover offer, or split the company into pieces and sell them separately.

The deadline for formal expressions of interest in UnitedNetworks is today.

Chief financial officer Ian Hadwin said a lot of interest had been shown in the company, both domestically and internationally.

"We've sent out a number of flyers to people who have approached us, or [we have] approached them," he said.

"We are waiting for the formal expressions to be received, then we'll be releasing the information memorandum to parties next week."

Hadwin said prospective buyers had to advise on what basis they wanted to proceed - whether shares, assets or both.

A confidentiality deed would also need to be signed before an information memorandum was sent to prospective buyers.

On the basis of the memorandum, potential buyers will be asked to make non-binding, indicative bids.

These must be sent in by the middle of next month.

UnitedNetworks and its advisers will then draw up a shortlist of bidders, who will go through to the next level of due diligence. Final binding bids will be due in late August.

One buyer interested in UnitedNetworks' lines business on the North Shore and in Waitakere City will be Vector, the electricity lines company for Auckland City, Manukau City and most of Papakura.

Vector is the second-largest lines company, with more than 250,000 connections to its network. It is expected to announce its annual results today.

UnitedNetworks originally had more than 200,000 shareholders, who got their share parcels when the company was privatised in the industry reforms of the mid-1990s. That number has dropped to around 18,000.

The price of UnitedNetworks shares has steadily improved since Aquila announced it wanted to sell, rising by nearly a dollar in value to around $8.50 a share.