Jamie Gray

Jamie Gray is a business reporter for the New Zealand Herald and APNZ wire agency

Asset sales proceeds to drop - Govt

Meridian Energy Te Apiti Wind Farm on the Ruahine Ranges.
Meridian Energy Te Apiti Wind Farm on the Ruahine Ranges.

The Government has revised the estimate of how much money it expects to receive from its partial asset sales programme down to $4.6 billion to $5b from an initial estimate of between $5b and $7b.

Finance Minister Bill English said the revision will appear in this month's half-year economic and fiscal update.

"The revised assumption of share sale proceeds is based on Solid Energy clearly being in no position to be sold anytime soon, and it takes account of other developments and the results of share offers to date,'' English said in a statement.

The Treasury's early estimates of share offer proceeds in 2011 were between $5 billion and $7 billion, based on five companies being in the programme, including Solid Energy, which has since encountered financial difficulties. For the purposes of forecasting, the Treasury had assumed sale receipts would be at the $6b mid-point of the range.

Excluding Solid Energy, those earlier assumptions put the estimated proceeds from the share programme at between $4.4b and $6.1b.

The sale of minority stakes in Mighty River Power, Meridian Energy and Air New Zealand has raised almost $4b. Genesis Energy's share offer is planned for the first half of next year, subject to market conditions.

- APNZ

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