Power blocs do deal on shares, board control

By RICHARD BRADDELL

WELLINGTON - Peace seems to have broken out among factions warring for control of the country's second largest independent electricity company, TrustPower, with an agreement to equalise board and shareholder representation.

The agreement between TrustPower's largest shareholder, Infratil, and investment partner Alliant, on the one side, and Australian Gas Light and Rotorua Electricity, on the other, provides for equal shareholdings between the two blocs and gives the right for each to appoint two directors to the board of six.

The agreement has three days of notice and pause to run under stock exchange listing rules before it comes into effect, while shareholder equalisation provisions can be terminated on 20 days' notice.

Alliant and Infratil together own 41.7 per cent. But while AGL has 17.7 per cent and the Rotorua Trust only 4.2 per cent, the size of that bloc is built up by the inclusion of the Tauranga Electricity Consumer Trust, which owns 22.7 per cent, even although it is not a party to the deal.

Nevertheless, Tauranga Trust's chair Jan Beange welcomed the agreement which she hoped would put to an end division among the shareholders and allow the company to move ahead.

Relations among shareholders have been difficult since AGL gained 7.5 per cent in a surprise placement by TrustPower itself and Infratil introduced Alliant as a 4 per cent shareholder.

Ms Beange said the Tauranga Trust had not considered whether it might seek board representation.

Infratil's chairman, Kevin O'Connor, said the agreement gave it board representation, something it has never had before, despite having $230 million, or 44 percent of its assets, invested in TrustPower.