Trustpower shareholder admits defeat on new trust plan
A proposal to wind up Tauranga Energy Consumer Trust won't proceed to a vote.
Trustpower’s 26% shareholder Tauranga Energy Consumer Trust has backed away from proposals that would have ended its annual payments to Trustpower customers in the area.
The proposal announced in January triggered a big hit on Trustpower’s share price, which fell 13% on the news.
In a statement, the TECT said it was withdrawing the proposal after considering feedback from local consumers.
“We maintained throughout this process that the wishes of consumers would remain at the heart of our decision-making and the consumers have clearly spoken,” said TECT chairman Bill Holland.
“The trustees acknowledge the efforts of the entire TECT community for their thoughtful engagement in this process.”
The TECT said it had received 21,000 written submissions and heard from 130 people directly. Only one third of written submissions supported the plan, it said, and trustees unanimously believed the community view was to withdraw it.
In a statement to the NZX Trustpower noted the decision and said it was “pleased that on this important matter a robust debate has occurred where the TECT trustees have canvassed, heard, and acted on the views of their beneficiaries.”
The company said it looked forward to a continued storng relationship with the TECT.
Under the TECT proposal, the trust would have been wound up and its assets vested in a charitable trust, which would use its funds for the benefit of community projects, rather than paying out money to Trustpower customers.
The TECT’s beneficiaries would have received a one-off payment of $2500 and a further five years of annual cheques of $360 per customer.
Analysing the proposal, Andrew Harvey-Green of Forsyth Barr estimated it could cost Trustpower $15-$23m in earnings because the TECT cheques gave it a significant advantage in retaining customers in the area, allowing it to charge higher prices.
Tim Hunter
Wed, 21 Mar 2018
Wed, 21 Mar 2018
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Trustpower shareholder admits defeat on new trust plan
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