KEY POINTS:
The Government is unlikely to halt the sale of the capital city's electricity network to a Hong Kong investor, despite political pressure for it to emulate its controversial veto of the Auckland International Airport deal.
Vector yesterday revealed it had agreed to sell its Wellington electricity network to Cheung Kong Infrastructure Holdings for $785 million.
The network distributes Wellington's power and therefore supplies many of the buildings that the Government itself operates in.
But it appears the Beehive does not view the network's strategic importance in the same light as it viewed Auckland Airport - which it stepped in to protect when a Canadian pension fund looked set to snare a 40 per cent stake last month.
The Vector sale needs the approval of Finance Minister Michael Cullen under the Overseas Investment Act, but because the network is not on land deemed "sensitive" under the Act, there appears little chance he will reject it.
Dr Cullen's office said yesterday that his advice was that the network was not on sensitive land, so it did not have to pass many of the hurdles facing the Auckland Airport sale.
The Hong Kong buyers of the network will instead be judged on whether they have experience and acumen relevant to the asset, whether they are of good character and have a financial commitment to the asset.
Cheung Kong Infrastructure Holdings, a large company which already has investments in various electricity networks around the world, including Australia, appears set to meet those tests.
Vector's chief executive Simon Mackenzie yesterday said the network was not on sensitive land and the buyers did have expertise in the industry.
"We can never say how the process will run, but I think on that basis, the way in which we look at it, we think it meets a number of the criteria as we understand it," he said.
The Government moved to change regulations when it became worried about Auckland Airport's partial sale, but there is no suggestion of a similar move to protect the Wellington electricity network.
Prime Minister Helen Clark said last night that she did not "have a particular view" on the sale of the network, which she pointed out had been in foreign ownership twice before.
Dr Cullen has previously said the network is not the same as the airport, which was by far the largest single piece of strategic infrastructure in the country.
But New Zealand First and the Greens are openly lamenting the sale to offshore investors.
New Zealand First economic development spokesman Doug Woolerton said it "was a pity" to see another asset pass from local hands to foreign ownership.
And he speculated the new owners could bring in their own workers from China under the new free trade agreement signed with that country.
Green MP Sue Kedgley said power charges were likely to rise for Wellington consumers because of the price paid by the new owners and said the New Zealand Superannuation Fund should be buying these assets instead.
"Surely it's in the national interest to own our energy networks, not allow them to fall into foreign control," Ms Kedgley said.
