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Mighty River Power float issue expenses estimated at NZ$48.7 mln

Posted in News

Issue expenses for the Mighty River Power float are expected to run to a whopping NZ$48.7 million, assuming the maximum Offer size.

The prospectus for the share float issued today outlines the rewards some of those involved with the float stand to get.

Roles in the float were heavily sought after among the investment banking and broking community.

The joint lead managers for the float are First NZ Capital Securities in partnership with Credit Suisse (Australia), Goldman Sachs New Zealand and Macquarie Capital (New Zealand).

Also involved as retail affiliates of the joint lead managers are JBWere (NZ) and Macquarie Equities New Zealand.

The New Zealand retail offer managers are Craigs Investment Partners and Forsyth Barr, while the retail offer co-managers are ANZ Bank NZ and ASB Bank.

Under the terms of this agreement each joint lead manager is entitled to receive a base fee of $666,666 in consideration for the performance of its services as a joint lead manager of the Offer.

"In addition, the Joint Lead Managers may each receive up to a further $1,333,334 by way of performance fees based on the achievement of certain agreed performance criteria relating to the achievement of agreed demand and value targets," the prospectus says.

The Crown has also agreed to pay the following selling commissions and fees:

  • The Joint Lead Managers will be paid, jointly, a commission of 0.4% of the aggregate proceeds of all Shares sold under the Institutional Offer to Institutional Investors in New Zealand;
  • The Joint Lead Managers will be paid, jointly, a commission of 0.8% of the aggregate proceeds of all Shares sold under the Institutional Offer to Institutional Investors outside New Zealand;
  • Each NZX 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 Institutional Investors in New Zealand under Broker Sponsored Bids bearing their stamp;
  • Each NZX Firm and selected trading banks will be paid a broker stamping fee equal to 1.0% of the aggregate proceeds of all Shares sold under the General Offer under valid Applications bearing their stamp; and
  • The Joint Lead Managers will be paid, jointly, a fee equal to 0.2% of the aggregate proceeds of all Shares sold under valid Applications made under the General Offer.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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