Vector's future in High Court's hands

By CHRIS DANIELS

A High Court judge's decision today may clear the way for selling a chunk of Vector, New Zealand's biggest power lines company.

Vector is owned by the publicly elected Auckland Energy Consumer Trust.

Trustee John Collinge has been told by trust chairman Warren Kyd that he cannot vote on a company plan to raise hundreds of millions of dollars in a share float, using the money to make a bid for Wellington pipeline company NGC.

If Vector was floated, the dividends that are now paid only to account-holders in its home area (Auckland City, Manukau City and part of Papakura) would be shared with a wider group - investors who buy new shares in the company.

Vector is about to give customers such a dividend, in the form of a $170 rebate on the power bills of 286,000 homes and businesses.

Listing on the stock exchange would bring new requirements, which privatisation opponents say will mean the end of any notion of acting in the public interest, possibly threatening programmes to put ugly overhead power lines underground.

Some opponents point to the experience of Ports of Auckland, where 80 per cent of the company's shares are owned by the public body Auckland Regional Holdings and 20 per cent by those who bought shares on the stock exchange.

During the port company's recent sale of Westhaven Marina, there was criticism of the fact that the major shareholder had no influence on the company's decision to sell.


Mr Collinge went to court to argue his right to vote on the plan, and Justice Barry Paterson is due to give his decision today.

If Mr Collinge cannot vote, the trust will be split down the middle. Mr Kyd and fellow trustee Karen Sherry are thought to favour a partial float and Mike Buczkowski and Shale Chambers are opposed.

Mr Kyd and Mr Collinge have supported partial privatisation, but have fallen out, making it unlikely they will agree on the latest plan.

Mr Collinge's right to vote has been challenged because he owns 200,000 Vector bonds, which would give him priority rights to buy shares in any offer.