Powerco applies for authorisation to acquire Egmont Electricity
Published28 Apr 1997
Powerco Limited has applied to the Commerce Commission for authorisation to acquire up to 100 percent of the shares in, or assets of, Egmont Electricity Limited.
Commission Chairman Dr Alan Bollard said that the Commission expects to release its final decision by July 21.
Powerco is 45 percent owned by the New Plymouth District Council. It generates electricity, and distributes and sells electricity and gas predominantly in the Taranaki region, and distributes and sells electricity in the Wanganui/Rangitikei area.
Egmont is entirely owned by the South Taranaki District Council. It generates, distributes and sells electricity in Taranaki. It is surrounded by Powerco.
Dr Bollard said that the Commerce Act prohibits business acquisitions that result in dominance being acquired or strengthened in any markets.
It also allows an otherwise prohibited acquisition to be authorised if the Commission is satisfied that, although the acquisition may result in dominance, its public benefits outweigh its detriments to competition.
If granted, an authorisation gives legal protection against anyone taking court action against the acquisition under the Act.
The Act sets out the process for the Commission to follow, and the Commission aims to keep the process as open to the public as possible.
After receiving the application, the Commission invites interested parties to register their interest. Others may also come forward and the Commission can accept them as interested parties.
It investigates the application, carrying out interviews and research as necessary, and then publishes a draft determination. The draft determination gives a preliminary view that, based on information currently available, it would or would not authorise the proposal.
The draft determination gives interested parties and the applicant a clear indication of how the Commission sees the issues and where it wants further information. They can then make submissions on the draft determination.
There is also provision for a conference to be held if necessary.
The Commission pulls together the information from its investigation, the submissions and the conference to make its final decision.
The Act gives it 60 working days to do this, but allows for extensions if needed.
The detailed timetable for the process is not yet available, but a final decision should be made by July 21.
Media contact: Chief Investigator Network Industries David Taylor
