9 Nov 2015

Near-$1 billion deal for Vector

11:01 am on 9 November 2015

Power lines company Vector has an agreement to sell its shares in Vector Gas to the global infrastructure asset manager First State Funds for close to $1 billion.

Vector said it will make about $167 million on the $952,000,000 sale, which includes Vector Gas's transmission pipelines and distribution networks outside of Auckland.

power lines

Photo: 123rf

Vector Gas also manages unregulated pipelines and is the technical and system operator for the Maui Pipeline.

Vector said the proceeds would be used to repay debt and strengthen its balance sheet, so it can expand its business in unregulated sectors of the industry.

The company also said it has a formal agreement to work with First State Funds to develop co-investment opportunities in regulated and unregulated energy infrastructure in New Zealand and around the world, and to co-operate on gas distribution operations.

Shareholders will be asked to approve the deal at a special meeting in December, with a view to settlement by the end of March.

The sale also needs the approval of the Overseas Investment Office.