Meridian Energy realises $600m profit

Wednesday, 30 November 2005

Meridian Energy realises $600m profit from Australian foray

State-owned power company Meridian Energy has completed the sale of its Australian subsidiary Southern Hydro to leading Australian energy company AGL.

The sale was announced on 31 October this year, and Meridian chief executive Keith Turner says final settlement of the $A1.425 billion deal took place today.

The sale includes the 62 megawatts (MW) of hydro assets in New South Wales bought by Meridian for $A85 million in April 2001, the 540MW, $A600 million Southern Hydro assets purchased in May 2003, the 91MW Wattle Point wind farm it commissioned in May this year, as well as several wind farm and hydro developments currently in the advanced development planning stages.

Dr Turner says completion of the deal marks the end of a highly successful foray into Australia.

"We went into Australia with a clear idea of what we wanted to achieve. The world-class hydro engineering expertise we have been able to contribute during our ownership has resulted in significant improvements to the assets we purchased.

"We have also applied our expertise in wind generation development to some big projects on the other side of the Tasman which may otherwise not have taken place.

"That, combined with a growing appreciation internationally of the advantages of renewable electricity generation, has seen a significant uplift in the value of those assets which has now been realised in the sale to AGL."

Dr Turner says Meridian has demonstrated that New Zealand businesses can succeed in Australia.

"We have achieved this highly successful outcome largely by having clear goals and by playing to our strengths. Perhaps the only thing we failed to appreciate was how quickly our strategy would bear fruit."

ENDS

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