Vector will not budge on its $2.91 offer for NGC shares, despite the market price remaining stubbornly above $3 a share.
The Auckland-based energy network company yesterday told the stock exchange it had completed its purchase of 66 per cent of gas transmission company NGC, buying the stake from Australian
Gas Light.
Vector chairman Michael Stiassny, chief executive Mark Franklin, Greg Muir and Brian Plimmer will join the NGC board. They replace AGL-appointed directors Greg Martin, Mark Harper and Greg Hayes.
Vector has just posted out the same takeover offer to all NGC shareholders, as it hopes to snare 100 per cent of NGC in a $1.2 billion deal.
NGC shareholders holding out for a better price and the promise of preferential rights in a Vector share float will now be hoping this offer fails and they are offered a second deal in the new year.
Vector's takeover document says its offer exceeded valuations prepared by the big investment banks.
Since AGL had sold its two-thirds stake, there was "very limited prospect of an alternative offer" for the shares from anyone else.
Since Vector's board and executives have signed a certificate swearing the offer is true, correct and not misleading, it cannot raise the offer price without incurring the ire of the Takeovers Panel.
Despite three of Vector's five trust members opposing the idea, it is floating up to 24.9 per cent of itself in an initial public offering next year, hoping to raise at least $500 million to help pay for the NGC takeover.
It initially hoped to attract NGC shareholders into accepting the lesser price with preferential rights in the Vector offering next year, but it withdrew this from the offer after the Takeovers Panel said the same deal should also be provided to AGL.
NGC shareholders may be offered those special rights in a second offer - likely if Vector fails to reach the 90 per cent threshold needed for compulsory acquisition of all shares.
The current offer closes on February 4. Vector has promised its offering will take place within 12 months from yesterday.
NGC plans to send its response to the Vector offer - including an independent appraisal report - to its shareholders at the end of next week.
* NGC shares closed yesterday unchanged at $3.10.
