Contact Energy shares gain as regulator mulls Manawa Energy takeover
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More news: Contact Energy shares rocketed on the ASX as the utilities group reiterated the "clear benefits" of its takeover of Manawa Energy to New Zealand, after the country's competition regulator outlined concerns over the proposed acquisition.
Contact shares were up 5.2% to $8.73 by 12:20pm AEDT, having added nearly 15% over the last 12 months.
Contact Energy battles NZ regulator on Manawa Energy takeover
The news: Utilities company Contact Energy has said its proposed buyout of Manawa Energy will make a "stronger, more resilient electricity company for New Zealand", after the country's competition regulator laid out "potential competition issues" with the move.
The context: The New Zealand Commerce Commission said that it is "not currently satisfied" that the proposed acquisition would not "substantially" lessen competition in the New Zealand electricity markets.
The regulator is currently scheduled to issue its clearance decision by 31 March. Contact continues to target completion of the takeover by the end of 2025.
Contact's acquisition of Manawa, announced last year, would see it takeover the renewable electricity generator's 25 hydro schemes located around New Zealand. Dual-listed infrastructure investor Infratil, which holds a 51% stake in Manawa, has said it supports the proposal.
What they said: "Contact and Manawa hydro assets are complementary, with different seasonal generation profiles, which will help Contact to better manage dry year risk and to sell larger volumes of fixed price electricity into the market than we could independently," Contact chief executive Mike Fuge said.
The sources: ASX announcement, Commerce Commission New Zealand
