Vector approves share float

Vector's owners - the Auckland Energy Consumers Trust - have overcome internal differences to approve a sharemarket listing for the giant energy network company.

Vector will list in late August or early September. The initial public offering is expected to raise between $550 million and $650 million - making it the biggest float since Contact Energy in 1999.

Last year Vector flagged the possibility that it might sell as much as 25 per cent of its stock to help fund its $880 million purchase of a controlling stake in gas distributor NGC.

Vector has said that a $354 million loan from investment bank ABN Amro that helped fund the NGC purchase must be repaid "from the proceeds of an IPO". But despite the enthusiasm of the Vector board and management team, only two of the publicly elected trust's five members - chairman Warren Kyd and Karen Sherry - initially backed the idea.

One trustee, John Collinge, was blocked from voting because of a conflict of interest and Kyd's casting vote approved the company's plans.

Yesterday's decision follows weeks of market speculation that the trust was getting cold feet and considering alternatives to the float.

One suggestion was for the trust to retain 100 per cent ownership of the Auckland electricity network but reduce its ownership of other assets.

Last night Kyd said the trust was pleased to be able to "finally end the long-running speculation on Vector's future".

A prospectus will be published in June and Auckland power users - the beneficiaries of the trust - will be given the opportunity to take part in the initial public offering.

It was likely that the IPO would also have an offer to minority NGC shareholders, the company said.