Thursday, October 10, 2013


Less than six months ago, National privatised Mighty River power, selling 49% of it for $1.7 billion. Now, with the share price plummeting, the company is launching a share buyback. Its pretty obviously a desperate ploy to boost the share price (and so help make the government's sale of Meridian look like a better deal), but it also reduces the whole asset-sales program into a farce. If companies have to do this, they're obviously not a very good deal. Meanwhile, those "mum and dad investors" are being fleeced by the government. "Thanks for the interest free loan, suckers!"

If this is how National's privatisations are going to work, then people have even more reason to avoid them.