Australian Gas Light says it will sell its $877 million stake in pipelines company NGC to Vector before the end of the year - despite a rebuff from the Takeovers Panel.
Likewise, Vector says the panel's decision will not jeopardise its $1.3 billion plan to take over NGC.
The Aucklandpower lines company is launching a takeover bid by buying the 66 per cent stake in NGC owned by AGL.
To pay for the deal, Vector will float just under 25 per cent of Vector and list on the New Zealand Stock Exchange.
The panel yesterday blocked the company's preferred method of buying the AGL stake - buying the holding companies that owned the shares, rather than buying the shares directly.
Vector chief executive Mark Franklin said he was "surprised and disappointed" at the panel's decision.
An AGL spokeswoman said new discussions with Vector were not centred around the price it would pay for the NGC shares. They were instead talking about "the alternative sales mechanism".
"The alternative structure will reflect a sale share price of NZ$3 a share and is not expected to materially change the net sale proceeds of A$760 million or the anticipated completion as previously announced to the market," AGL told the Australian stock exchange.
Vector is also still waiting for approvals from the Commerce Commission under competition rules and electricity industry regulations.
Another Australian energy company, Origin, was successful less than two months ago in getting a dispensation from the panel to buy Edison Mission Energy's holding company in New Zealand, rather than all its shares in Contact Energy.
AGL may have been unlucky in having its application heard by the panel just weeks after a decision to grant a waiver in the Prime/Powerco takeover.
Warren Kyd, chairman of the Auckland Energy Consumer Trust, which is wracked with conflict over the partial privatisation and float plan, yesterday said he wanted trust beneficiaries to have some kind of priority access to the new shares.
The beneficiaries are power account holders in Auckland City, Manukau City and Papakura.
* NGC shares are still above the $3 a share offer price. They closed yesterday unchanged at $3.09 each.
