Consumer Energy Trust Takes Majority Shareholding

NZX/Media Announcement
18 August 2011

Buller Electricity Ltd (BEL) says becoming the majority shareholder in independent retailer, Pulse Utilities New Zealand Ltd, fits with its investment strategy, commitment to support continuing development of a competitive electricity market and adding value to its consumer owners.

“Our stake in Pulse is another step in our investment strategy to sustain our future. Pulse has a vision to establish itself as a low cost supply option for customers and BEL shares that aim,” says BEL Chairman Frank Dooley. “Pulse has improved retail competition and that is delivering savings on power bills and social dividends to our community. As a consumer-owned trust it is the consumer who will reap the benefits from having a choice of a low cost electricity retailer. ”

Pulse shareholders overwhelmingly supported a proposal to recapitalise the business in a cash for equity deal that provides a strong capital base for sustainable growth for the low cost energy supplier and sees long term supporter, BEL become the biggest shareholder. Its stake will settle at a minimum of 65 per cent following a share purchase plan to be presented to existing shareholders next month.

“This deal secures the company’s future,” Pulse Acting Chairman, Joseph van Wijk told shareholders at the annual meeting in Auckland today. “We are the fastest growing, independent electricity retailer in the country, acquiring new customers each month with our low cost, high value, fair deal. We now have a secure financial foundation to enable us to move forward with confidence and achieve a maiden profit in the medium term.”

Mr Dooley said BEL had first taken a small stake in Pulse in 2009, first attracted by its proprietary smart metering IP and in the past year has seen the success of the branded Just Energy retail strategy with the significant growth in customer acquisition.

“Our belief in Pulse has not dimmed. It has been handicapped by a lack of capital and we welcome the opportunity to provide the means for it to prosper and grow to be a genuine competitive choice.”

Mr Dooley said BEL also welcomed the electricity reforms being introduced by the Electricity Authority to improve retail competition and the operation of the wholesale electricity market.

“This will be good for all New Zealand consumers and also encourage investment and true competition in the sector,” he said.

ENDS

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