Thursday, May 02, 2013

A rush to privatisation

The government hasn't even finished selling Mighty River Power, but it is already rushing to privatise our remaining assets:

The Wall Street Journal reported overnight that the Treasury has called for investment banks to tender for leading roles in the partial privatisation of Meridian Energy and Genesis Energy. The report said pitches for the work were due by the end of this month.

This morning a spokeswoman for Treasury confirmed the agency was "undertaking preparatory steps for the next IPO/s, including selecting JLMs [joint lead managers]".

She added: "Ministers have indicated publicly that they would like to see at least one more IPO [initial public offering] in 2013, subject to market conditions and the preparedness of the companies.

Quite apart from the anti-democratic attempt to evade the expected referendum (which we should hear about by next Sunday), this is simply dumb. Flooding the market with electricity company shares is not going to result in the best return for the government. But then, this has never been about getting a good deal for the people of New Zealand - it has always been about putting those companies - and their oligopoly revenue stream - into the private hands of National's donors and cronies.