Collinge barred from making crucial Vector vote

By CHRIS DANIELS

Plans to sell off a chunk of Vector are due to be voted on tonight, after a High Court judge barred one of its owning trustees from casting a crucial vote.

John Collinge, a veteran of the often cut-throat world of Auckland energy politics, has been told he cannot vote on a plan to float part of the company and put it on the stock exchange.

Vector is putting together a takeover bid for gas transmission company NGC, but needs to issue shares to new investors to raise up to $700 million to help fund the deal.

Vector is currently 100 per cent owned by the Auckland Energy Consumer Trust, which is elected by Aucklanders every three years.

Trust chairman Warren Kyd says fellow trustee Mr Collinge cannot vote on the proposal to float on the stock exchange, as he owns bonds in Vector - bonds that will increase in value should the float proceed.

Mr Collinge disputes this, saying Mr Kyd has constantly pushed privatisation plans and has seized on his ownership of bonds as a way of shutting him out of the vote.

As a former director of Vector, Mr Collinge said it was entirely appropriate he owned bonds issued by the company, and they would not affect how he voted.

Grey Power energy spokesman David Berry yesterday said privatisation of the industry had been "one of the worst decisions the financial planners and certain politicians have inflicted on the electricity users of this country".

Justice Barry Paterson's decision yesterday made it clear that political promises did not override the trust's legal obligations.

"Political platforms do not allow them to breach duties imposed on them by law. They have a very important role in approving certain major or significant transactions," he said.

This means that even if a trustee was elected on promises to never privatise Vector, they would have to seriously consider privatisation proposals, or risk breaching the rules.