Power company value rises $190m as sale nears

Mighty River's value rose $190 million to $3.91 billion in the year to June last year, according to board estimates. Photo / APN

The Government has received good news ahead of its partial asset sales plan with a $190 million boost in the value of the first company on the block, Mighty River Power, which is due to be sold in the next five months.

But Genesis Energy, slated for partial sale next year, has lost $70 million in value over the past year, according to board estimates, and troubled state-owned coal company Solid Energy's value remains shrouded in uncertainty.

The Treasury's Crown Ownership Monitoring Unit (Comu) yesterday released the latest valuation for its portfolio of state-owned enterprises.

Among the five companies earmarked for partial sale under the "mixed ownership model", Mighty River's value rose $190 million to $3.91 billion in the year to June last year, according to board estimates.

The Government plans to sell up to 49 per cent of the company in the second quarter of this year, depending on the outcome of the Supreme Court's hearing of the Maori Council bid to block the sale at the end of this month.

The new Mighty River valuation means the Government could raise about $2 billion of the $5 billion-$7 billion it hopes to raise from the entire asset sales programme with one transaction.

The biggest company earmarked for sale, Meridian Energy, which generates about 30 per cent of New Zealand's electricity, gained $79 million in value, giving a total value of $6.58 billion.

Genesis, however, lost $70 million in value, taking its total worth to $2.05 billion.

The Government has put the sales of Solid Energy and Air New Zealand on the backburner due to recent operating uncertainties for both.

A board valuation for Solid Energy was not given.

"Changing and challenging sector conditions and a large turnover in board members including a new chair" meant a new valuation had yet to be completed, Comu said.

The company's value was slashed by about half a billion dollars to $2.77 billion last year as coal prices softened.

Air New Zealand's value was determined by changes in price for the 24 per cent of its shares already traded on the sharemarket.

It lost $213 million in market capitalisation, taking its theoretical market value to $690 million.