New Zealand announced yesterday it will sell 49 percent of a state-owned energy company and list the shares on the country’s stock exchange in about mid-May.
Mighty River Power is the first of three power companies the government plans to sell minority stakes in. It hopes to raise billions of dollars and return the country’s books to the black.
The government said it will sell 49 percent of the company through a share offer that will open in about the middle of next month. The company is valued at NZ$3.6 billion (US$3 billion), meaning the listing could raise about half that. It will also be listed on the Australian stock exchange, likely to attract financial institutions there to buy shares in the initial public offering.
Many New Zealanders oppose the plans, which a number of people equate with selling the family silver.
The government promised to favor so-called “mum and dad” investors by offering New Zealand retail investors a loyalty bonus, the details of which have yet to be announced. It also promised that small New Zealand investors applying for up to NZ$2,000 worth of shares would get their full allotment even if the initial public offering was oversubscribed.
“As promised, New Zealanders will be at the front of the queue for shares,” New Zealand Prime Minister John Key said at a media conference on Monday.
David Shearer, leader of the opposition Labour Party, said in an interview that New Zealanders are “overwhelmingly” against the sale and that his party would put a halt to the asset-selling program if it wins next year’s general election.
He said he could not promise it would buy back any shares already sold by then.
“We were shocked to hear that shares will be offered on the Australian exchange as well,” Shearer said. “The promise has always been that New Zealanders would be at the front of the queue, but this seems to reach out for corporate investors.”
The government last month won a Supreme Court ruling which allowed the sale to proceed.
Maori had argued they held traditional rights to the Waikato River water that is used by the power company to generate electricity. The Maori Council argued a listing of the company would prejudice its financial claims to those rights, but the court found that a partial sale would not impede the claims.
The government also plans to sell 49 percent stakes in Genesis Energy and Meridian. The planned sale of a minority stake in a fourth energy company, Solid Energy, appears unlikely after that company ran into financial difficulties. The government has also said it may reduce its 73 percent stake in national carrier Air New Zealand.
Three experts in the high technology industry have said that US President Donald Trump’s pledge to impose higher tariffs on Taiwanese semiconductors is part of an effort to force Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to the negotiating table. In a speech to Republicans on Jan. 27, Trump said he intends to impose tariffs on Taiwan to bring chip production to the US. “The incentive is going to be they’re not going to want to pay a 25, 50 or even a 100 percent tax,” he said. Darson Chiu (邱達生), an economics professor at Taichung-based Tunghai University and director-general of
‘LEGACY CHIPS’: Chinese companies have dramatically increased mature chip production capacity, but the West’s drive for secure supply chains offers a lifeline for Taiwan When Powerchip Technology Corp (力晶科技) entered a deal with the eastern Chinese city of Hefei in 2015 to set up a new chip foundry, it hoped the move would help provide better access to the promising Chinese market. However, nine years later, that Chinese foundry, Nexchip Semiconductor Corp (合晶集成), has become one of its biggest rivals in the legacy chip space, leveraging steep discounts after Beijing’s localization call forced Powerchip to give up the once-lucrative business making integrated circuits for Chinese flat panels. Nexchip is among Chinese foundries quickly winning market share in the crucial US$56.3 billion industry of so-called legacy
Hon Hai Precision Industry Co (鴻海精密) is reportedly making another pass at Nissan Motor Co, as the Japanese automaker's tie-up with Honda Motor Co falls apart. Nissan shares rose as much as 6 percent after Taiwan’s Central News Agency reported that Hon Hai chairman Young Liu (劉揚偉) instructed former Nissan executive Jun Seki to connect with French carmaker Renault SA, which holds about 36 percent of Nissan’s stock. Hon Hai, the Taiwanese iPhone-maker also known as Foxconn Technology Group (富士康科技集團), was exploring an investment or buyout of Nissan last year, but backed off in December after the Japanese carmaker penned a deal
WASHINGTON POLICY: Tariffs of 10 percent or more and other new costs are tipped to hit shipments of small parcels, cutting export growth by 1.3 percentage points The decision by US President Donald Trump to ban Chinese companies from using a US tariff loophole would hit tens of billions of dollars of trade and reduce China’s economic growth this year, according to new estimates by economists at Nomura Holdings Inc. According to Nomura’s estimates, last year companies such as Shein (希音) and PDD Holdings Inc’s (拼多多控股) Temu shipped US$46 billion of small parcels to the US to take advantage of the rule that allows items with a declared value under US$800 to enter the US tariff-free. Tariffs of 10 percent or more and other new costs would slash such