Windflow markets $8m IPO

Fledgling wind energy company NZ Windfarms Ltd is embarking on a 10-day roadshow to promote its $8 million initial public offering (IPO).


The company, a spin-off of listed turbine manufacturer Windflow Technology, opened the offer yesterday. It is being managed by Greenslades and will close on December 2.


New shareholders will pay $1.10 per share, while "eligible investors" - existing Windflow Technology shareholders or subscribers for $250,000 and above - will pay $1 per share.


Each share has a separately tradable option attached with an exercise date of not later than September 29, 2006, and a price of $1.10.


The shares will trade on the stock exchange's alternative market, the NZAX.


The IPO is part of an ambitious plan to establish NZ Windfarms as an independent owner, operator and developer of wind farms throughout New Zealand.


NZ Windfarms is seeking funds to build stage one of its Te Rere Hau wind farm, next to the Tararua wind farm near Palmerston North. The company already has resource consent for the project.


NZ Windfarms is hoping to catch the attention of investors looking to cash in on the booming demand for electricity, which, against a backdrop of dwindling gas reserves, is far outstripping supply.


Spot market wholesale prices have rise 50 per cent in the past eight years, while average retail prices have climbed more than 500 per cent since 1975, NZ Windfarms said.


"Last year the wind industry grew by over 350 per cent and that was just the beginning," NZ Windfarms chief executive Chris Freear said.


"We're well placed to take advantage of the current gap between New Zealand's production capacity and demand growth."


The NZ Windfarms board includes three veterans of the New Zealand electricity sector.


Chairman Derek Walker was chief executive of CentralPower and led the development of the $50 million Tararua Wind Farm (now owned by TrustPower). Barrie Leay was executive director of the Electricity Supply Association and Keith McConnell is a former chief executive of The Power Company and United Electricity.


The other two directors are Juliet McKee, an economist, and fellow of the Institute of Directors, and Vicki Buck, former mayor of Christchurch.


Chief Executive Chris Freear is a director of the New Zealand Wind Energy Association and has worked in the energy industry for more than 10 years.


Public meetings to promote the IPO will be held in Dunedin, Christchurch, Nelson, Auckland, Wellington, Tauranga and Palmerston North from November 7-17.


- NZPA