The partnership, and the expertise and capital it brought to Flick, would allow it to do more, faster.
Bennetts said the investment in Flick was part of Z's "What is Next" strategy and capital management plan disclosed at an investor day last year.
"We are continuously assessing options to invest and extend into one of our three preferred market spaces – future fuels, mobility and the last mile."
Flick Electric is a privately-held company that reported revenues of $43.4m for the last financial year.
Z Energy will pay an initial sum of $15.6m for 22 per cent of Flick in new issued capital and an additional $30.4 million for the purchase of an additional 48.1 per cent of existing shares to take the total shareholding to 70.1 per cent.
In the next quarter, the governance of Flick will change to reflect Z's majority shareholding position.
Recognising that two of Z's directors, Mark Cross and Steve Reindler, were conflicted, the
governance of this transaction was entirely managed by a board committee comprising of Z's other directors.
Cross was a director of Genesis Energy and Reindler a director of Meridian and both will step down as a directors of those companies with immediate effect given Z's stake in a competing electricity company.
Z, which in the last year reported a $263m profit, will use existing credit facilities to fund the investment.
The transaction will not impact current financial year earnings or dividend guidance.
Z Energy expects the investment in Flick Electric to add to its earnings from the 2021 financial year.
Flick is Wellington-based and was last year awarded top energy retailer at Deloitte Energy Excellence Awards.
It sells customers electricity at wholesale prices, plus an operating margin. This means customers are exposed to the risks of the spot market, and during price spikes Flick issues warnings to them about cutting power use. Its customers can save money by running their appliances when power prices are low.
Z's profit for the 12 months ended March 31 was up $20m from the previous financial year and marked a historical high for the company.
Overall revenue for the company was up $26m to $449m.
The fuel industry came under fire earlier this year after a leaked email from BP revealed that company's pricing tactics, prompting Energy Minister Megan Woods to call BP in to explain.
The leaked email also mentioned Z Energy.
The industry was already being scrutinised after a report by three independent economic consultancies for the Ministry of Business, Innovation and Employment (MBIE) released last July found New Zealand's petrol market may not be competitive, with retail margins increasing over the past five years while more expensive petrol in the South Island and Wellington aren't explained by higher costs in those areas.
Z said at the time of its profit announcement that it believed the most likely outcome of last year's fuel market study was a Commerce Commission market review once relevant legislation is passed later this year.
"In our view a market review is likely to find a competitive market dynamic working effectively as demonstrated by the tension between volume and margin for existing participants, multiple new entrants investing capital due to the low barriers to entry, and customers have a wide range of choices for price and non price-based offers," Z said.
With BP, it also faces legal action over supply of aviation fuel to Air New Zealand when the Marsden Pt to Auckland fuel line was ruptured last September.
