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EARNINGS
The estimated cost of the Mighty River Power share float – including brokerage and commission, and legal and management fees – is approximately $48.7 million.
The sum also includes employee compensation and benefits specifically related to the offer, advertising costs, printing costs and postage.
Of the overall amount, $8.5 million will be incurred in 2013 financial year, spread across professional services, contractor fees and other issue expenses.
Investment banks Goldman Sachs New Zealand, Macquarie Capital New Zealand and First New Zealand Capital/Credit Suisse Australia are the book runners, or joint lead managers for the Mighty River float.
They each receive a base fee of $666,666 and may each receive up to a further $1.333 million in performance fees.
Then they share commission 0.4% of the aggregate proceeds of all shares sold under the institutional offer to New Zealand institutions, 0.8% of the international institutional offer and a fee of 0.2% of the proceeds of all shares sold under the general offer.
Each NZX broking firm and selected trading banks will be paid a fee of 0.6% of the aggregate proceeds of all shares sold under the institutional offer to institutions in New Zealand and stamp fee of 1% of all shares sold under the general offer.
ANZ New Zealand, ASB, Craigs Investment Partners and Forsyth Barr are the retail syndicate.
Australian and other overseas investors are expected to be offered up to 30% of the shares sold by the government in the Mighty River float.
With the government maintaining a 51% stake, New Zealanders should continue to own at least 85% of the company.
Last year State Services minister Tony Rall said the government expected to pay $100 million in fees for the entire Mixed Ownership model, which also includes partial floats of Meridian and Genesis and possibly Air New Zealand and Solid Energy, if and when ready.
Duncan Bridgeman
Fri, 05 Apr 2013
Fri, 05 Apr 2013
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Prospectus reveals Mighty big float costs, fees
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