Minority share offers Bill completes committee stages
The Government’s Bill enabling New Zealanders to own minority shares in four state owned energy companies has completed its committee stages.
New Zealanders wanting more information can visit the website: www.governmentshareoffers.govt.nz
“This bill is about controlling our nation’s debt in uncertain times,” says State Owned Enterprises Minister Tony Ryall, “It is part of a wider economic programme to get on top of debt, increase savings, and get our country through the worst economic crisis in 100 years.
“New Zealand’s debt was $8 billion in 2008. Today it is $52 billion, and it is forecast to reach $71 billion in 2015/16. We’ve had to borrow more to protect our important public services and to support Christchurch after its earthquakes.”
“We have to control that debt – huge out of control debt is why the United Kingdom, Ireland, Spain, Italy, and Greece are being forced to impose tough measures.
“Over the next 3 to 5 years around $6 billion in proceeds from these share offers will pay for priority new public assets like modern schools and hospitals through a new Future Investments Fund. That is $6 billion we would otherwise have had to borrow from overseas lenders – increasing our forecast debt in 2015/16 to around $78 billion.
“There is over $100 billion on term deposit in this country and we will be aiming the share offers at all New Zealanders – in fact we have set a target of 85-90 per cent New Zealand ownership at the time of the offer.
“The world uncertainty may also see more interest in the government share offers as local investors stay home rather than invest overseas, and as they look to invest in known infrastructure businesses.
“The first Share Offer – for a minority share in Mighty River Power – is expected around the third quarter of this year, markets permitting.”
This bill is set down for its third reading next week.
Pre-Prospectus Disclaimer
The Crown is considering offering shares to the public in one or more of Genesis Power Limited, Meridian Energy Limited, Mighty River Power Limited, Solid Energy New Zealand Limited and Air New Zealand Limited. No money is currently being sought and no applications for shares will be accepted or money received until after an investment statement containing information about the relevant offer of shares is available.