2nd UPDATE:Infratil Consortium In Talks To Buy Shell New Zealand Assets
03 Novembre 2009 - 1:18AM
Dow Jones News
Utilities investor Infratil Ltd. (IFT.NZ) in consortium with the
government New Zealand Superannuation Fund said Tuesday it has
entered exclusive negotiations with Royal Dutch Shell PLC (RDSA,
RDSB, RDSA.LN, RDSB.LN) over the possible acquisition of Shell New
Zealand Ltd.'s refining and downstream distribution and retailing
businesses.
The combined revenue of Shell's downstream businesses totaled
NZ$2.9 billion in 2007, Shell said in May.
In a statement, Morrison & Co. which manages Infratil, said
the scope of the proposed transaction includes, but is not limited
to, a 17.1% stake in New Zealand Refining Co. (NZR.NZ), Shell New
Zealand's supply-and-distribution infrastructure, and its retail
and B2B fuel business.
"The consortium has submitted a non-binding conditional proposal
to Shell and has entered into the final phase of due diligence," it
said.
"Discussions and negotiation will continue during November and
further advice on the status of the discussions will be provided as
material developments occur."
Shell New Zealand late last year said it was conducting a review
of its downstream business as part of a strategic review of its
global businesses. In May, it appointed UBS AG (UBS) to help with
the sale.
All of its downstream businesses, with the exception of its 36%
stake in construction and roadworks company Fulton Hogan, were up
for sale.
The company's downstream assets include 230 fuel stations, a
marine business, commercial fuel and aviation operations, the New
Zealand Refining Co. stake, and a 25% stake in Loyalty NZ.
Its distribution network, part of the downstream businesses,
includes terminal facilities throughout New Zealand.
Shell in May said it accounts for more than 50% of New Zealand's
natural gas production and a big proportion of the country's oil
production, which is not for sale.
The upstream businesses comprise a 50% stake in the Kapuni
field, an 84% stake in the Maui gas field and a 48% stake in the
Pohokura field--all of them located in the country's North
Island.
The government in May suspended payments to the New Zealand
Superannuation Fund, which has assets of around NZ$15 billion,
because of stress on the government's finances. The fund is
designed to smooth government pension payments around the middle of
the century.
Forsyth Barr broker David Price said Infratil's share price,
down 1.2% to NZ$1.63 midsession, shows the lack of enthusiasm for
the deal.
Until it is finalized and more detail is known, the stock will
remain under pressure, he added.
"We don't know enough about it--what's in the deal, how they are
going to fund it. There are no synergy benefits. People have
received it not that favorably and they need more information."
Infratil said it won't say more until the deal is finalized,
with talks to continue through the month.
NZ Refining shares were up 0.6%, to NZ$5.23 in a flat market,
where the NZX-50 benchmark index was down 0.1%, at 3,180.39.
-By Simon Louisson, Dow Jones Newswires; 64-4-471-5990;
simon.louisson@dowjones.com
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