Written By:
James Henderson - Date published:
8:47 am, July 18th, 2012 - 14 comments
Categories: privatisation -
Tags:
Key says the odds of a delay in the sale of Mighty River are like the “chance a meteorite will hit the Earth this afternoon”. It turns out, that’s a near certainty. So, Key was accidentally, telling the truth – the odds of a delay in the asset sales are growing daily.
No investor is going to buy into a company when the rights to its primary input, water, are up in the air. Not for a good price. If the government is getting its money’s worth from all those expensive sales advisors, they will be telling it that now would be a disastrous time to sell (of course, they won’t be telling it that, they want to make more money as middlemen, which means pushing ahead with the sales come hell or high water). The price finding exercise will surely show that the government would get an awful price if it pushes ahead with a sale now.
And it gets worse for National. When this heads to court, the judge is likely to injunct any sale because shares in Mighty River would be an obvious redress for iwi and it would be much less certain that the Crown could provide that redress if it has already sold all or most of the shares it is legally allowed to sell.
It’s really in Key’s hands. Does he call a halt himself and commit to selling the water rights issue first, or does he force himself to dragged kicking and screaming into a delay?
Based on past experience, Key will keep on playing the race card and hope that something pops up to save the asset sales.
Keep chasing that star, John.
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Key appears to have deliberatley inflamed this situation to actually drive DOWN the price of shares to his mates. It is a typical ploy of the money trader. Arsehole!
National has dramatically undervalued those SOE’s from the get go.
According to the Crown Ownership Monitoring Unit Report for 2011 (PDF), their commercial value in 2011 totaled just over $16 billion… 49% of that is $7,848 million, yet National say they will get around $6 billion. That’s $1.8 billion less than their commercial value.
National want to sell our assets to their rich mates cheaply, and then suddenly their value will increase again. What a bunch of crooks!
That doesn’t surprise me in the least. Selling state assets is always done for the benefit of the private purchasers and not the state thus selling them for as little as possible is what the sellers (in this case this government) wants.
Actually, which page you looking at? The pie graph on page ten has energy assets valued at $22.8b
I was looking at the commercial value of each asset… Page 64 onwards. That $22.8 billion probably doesn’t asses value based on production cost and related overheads.
Thanks, problem with skimming while trying to do other things – you miss things 😳
Typical behaviour from investment bankers.
Air NZ is virtually worth nothing in the current market.
Solid energy not much more especially as it has purchased pike river.
Gerrymandering brownlees interference in the SOE”s finances and set ups has reduced the electricity companies value.
Apologies . I’ve just read “Opportunistic” and realised I’m not the first to assume the above.
Landslide; cue Stevie Nicks
vto had it right the other day. Key will fail at the peak, it’s written in his character.
“When this heads to court, the judge is likely to injunct any sale because shares in Mighty River would be an obvious redress for iwi and it would be much less certain that the Crown could provide that redress if it has already sold all or most of the shares it is legally allowed to sell”
One the Justice system moves much more slowly than this and as the Crown isnt ‘legally bound’ by the Waitangi recommendations its hard to see where a Judge could hang his hat preventing a ‘partial sale’.
My guess is that the water rights/ownership issue has been a background only issue purely because there is no easy legal answer that will benefit Maori. They dont wont to run a test case they will lose.
The SOEs were gaining commercial benefit from the water rights for a long time, a partial sale only changes some of the actors on stage not the theatre of the absurd its playing in.
An injunction can move quickly BUT who can afford to pay the security for costs that may have to underpin it?
And as we set up to sell a report released in May documents the re-municipalisation of services in Europe – including water, electricity, public transport, cleaning services, waste management and housing. Why? A few reasons but cost and efficiency come out as tops:
And in particular, the Munich buyback of electricity is interesting – private interests don’t ‘do’ long-term investment:
Key can’t lose this one. It’s the only “policy” his government has to deal with our economy. He will die before conceding defeat on it. Unless a mystery illness suddenly pops up for him.
And Labour is F*&%$% in all of this because if they come out in favour of Maori water rights, there goes a portion of their middle NZ support. So they say almost nothing. Again.
It was good watching Glen Owen say that asset sales is a big mistake.. Well, here’s a man worth over 900 million, so I assume he knows what he is talking about. Makes Key look foolish. Key is selling them to make his mates rich just like his so called neutral tax cuts for the wealthy and raising gst.. that cost us 1.2 billion a year and there are more of us than the rich and we’ll have to pay that off.. somehow. Every time I hear news commentators say that the government is tightening up its purse, and they have to do so and so.. How much money are given to road consultants? It’s Key’s priorities and not the tightening of the government belt that is causing those 50 thousand to leave for Australia.