Vector extends NGC cloak

By CHRIS DANIELS


Auckland powerlines company Vector has won a new court order keeping secret the details of a potential $900 million bid to buy NGC.

Information about the takeover was due to be revealed this afternoon, but the group has been granted an extension on the secrecy order until October 20.

Known as Project Nugget, the plan was outlined in the High Court last month during a bitter battle over privatisation at Vector's owner, the Auckland Energy Consumer Trust.

Trust members opposed to a partial float and stock exchange listing for Vector had been trying to vote down the proposal, but were defeated.

Observers believe Vector plans to acquire NGC by first buying a 66 per cent stake owned by Australian energy giant AGL. If successful, it is then obliged by takeover rules to bid for the entire company.

But Vector faces competition - as many as 20 rivals expressed an interest in AGL's stake in NGC. Indicative bids for the shares are due today.

More than 35 per cent of all New Zealand's electricity connections are through the Vector network, and it also owns the second-largest gas network.

The group has already shown that it can successfully integrate another major business, with the largely trouble-free amalgamation of the much larger UnitedNetworks last year.

But there has been nothing trouble-free about the trust that owns Vector. Four of the five trustees were elected on the Auckland Citizens & Ratepayers Now ticket, which supported partial privatisation under certain conditions.

The four have now fallen out, with John Collinge and Mike Buczkowski opposing the deal, and Warren Kyd and Karen Sherry support the plan.

The fifth trustee, Shale Chambers, was elected on a no-privatisation platform.

Chairman Kyd launched court action against Collinge, Buczkowski and Chambers, saying they had neglected their duties as trustees. If they did not attend a meeting and vote on Project Nugget, they could have been sacked as trustees by the court.

Kyd has dropped the court action - the meeting to vote on Project Nugget was held.

NGC is worth $897 million at its present share price and a break-up of the company, which also has interests in gas trading, LPG processing and electricity metering, is possible.