Natural Gas stake points to TrustPower boilover

By Geoff Senescall

The battle for control of Tauranga-based TrustPower appears to have spilled over into Natural Gas Corp.

This follows speculation that Infratil has built up a small stake in Natural Gas, which is 71 per cent owned by the infrastructure investor's foe Australian Gas Light Company.

Both Infratil and its United States-based partner Alliant are also wrestling for control of Tauranga-based TrustPower with AGL.

TrustPower is backing AGL, with whom it wants to form an alliance. But this is being contested by Infratil and Alliant, which hold around 40 per cent of TrustPower between them and are looking to increase their holding to 49.5 per cent.

Brokers yesterday suspected that the recent buying in Natural Gas, through Deutsche Bank, was being done by either Infratil or Alliant.

They noted there had been heavy trading in Natural Gas following the breaking of an ownership deadlock last month between Fletcher Energy and AGL. Each had a third of the company.

Given the volumes, a single party could easily have amassed enough shares to be sitting just under the 5 per cent disclosure level, one broker said.

But if the intention is to build a blocking stake, some 10 per cent of Natural Gas' shares must be acquired to stop any full takeover bid.

While AGL recently said it did not have any plans to take out the minority holders in Natural Gas, brokers see it as a logical step. That is because AGL wants to expand its retail energy operations in New Zealand and that might not be the favoured direction for NGC's 8000 minority shareholders.

Meanwhile, despite the announcement that AGL has purchased Fletcher's one-third stake in Natural Gas, a price has yet to be determined. All going to plan a price is expected to be struck next week at around 205c a share.