Origin sells Contact stake

Origin EnergyMajority shareholder Origin Energy (Australian energy company) has sold its stake in Contact Energy according to the New Zealand Stock Exchange this morning.

After 11 years, Origin has sold its stake to local and overseas institution and retail investors.

ASX-listed Origin, which owned 53.1 per cent of the Wellington-based electricity generator retailer and owner of gas distribution and LPG businesses, said it sold all of its 89,314,921 shares in Contact.

Trading in Contact shares has been halted on the NZX and the sale is due to be completed on Wednesday.

The sale is being managed and underwritten by Macquarie Capital at $4.65 a share, a seven per cent discount to the last market price of $5.02.

The price values Origin’s holding at $1.8 billion.

Origin’s directors Grant King, Karen Moses and David Baldwin will step down from Contact’s board on completion of the selldown.

Long-serving director Phil Pryke will assume the interim chairmanship. Contact CEO, Dennis Barnes, an Origin employee, is to stay on as a Contact employee.

In a presentation filed to the NZX this morning, Contact said on August 17 it expects to report underlying earnings after tax of $161 million for the year to June.

Under a revised dividend policy it expects to pay 100 per cent of underlying earnings in dividends, up from 80 per cent previously.

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