web analytics

Mum and Dad investors are no longer a priority

Written By: - Date published: 3:05 pm, March 27th, 2014 - 13 comments
Categories: uncategorized - Tags:

John Key billboard selling New Zealand

And now for something completely different …

Throughout the asset sales programme the mythical “mum and dad” investors have been held up as the reason why what appears to be in economic terms a very silly idea was actually very sound. The Government has claimed without proof that allowing private shareholders will instill much needed commercial discipline into the SOEs, will enliven the stock market and will create a new democratic structure where ordinary mums and dads would be able to become part of a shareholding corporate style democracy.  Nirvana for most of us will be just around the corner.

Of course the reality is that National just wants to hand out our property to its rich mates.  They have never let reality get in the way of political or corporate dogma.

And now that we are at the end of the firesale of the various power company shares the pretence is being dropped.  Institutions and not mum and dad investors will be favoured in the Genesis share float.

A few weeks ago the Government floated the possibility that only 30% and not 49% of Genesis’s shares would be sold to the public.  It expressed pessimism even though the returns were looking really good.  The Government has shaved millions off Genesis’s value so that its expected yield is around the 15% mark.  This is a phenomenally good return for a utility.  David Cunliffe estimates that at this price the Government is losing $300 million on the likely value of the shares.  To make it even better for investors the Government has promised to throw in a one for fifteen loyalty bonus for New Zealand investors.

Institutional shareholders and investors will compete for over 80% of the shares on offer with the rest being available to the mythical mum and dad investors.  For the Mighty River Power float the figures were that roughly 55% of issued shares was owned by New Zealand retail investors, 18% by New Zealand institutions and 27% by overseas institutions.  These figures give a distorted impression however as the top 11% of retail investors owned half of that particular group of shares.

No doubt any mum and dad investors have been burned by the loss in value of Mighty River Power shares and no longer have any money to spend on shares.  I suspect a few wealthy individuals and foreign corporates will be thinking favourably about investing in Genesis.

13 comments on “Mum and Dad investors are no longer a priority ”

  1. Mary 1

    We’re not at the end of the firesale, we’re at the very beginning. Watch what happens to the 51% when Key gets a third term.

    • poem 1.1

      True Mary, ” IF ” key gets a third term.

      • Mary 1.1.1

        I deliberately said when because that’s what I believe. Of course I want to be wrong but at the moment that’s what I believe because the Left is stuffed at the moment.

  2. Will@Welly 2

    It never was about “you and me”. It was always about John Key!!
    What a parlous state of affairs this country has sunk too. A money trader masquerading as a leader.

  3. Enough is Enough 3

    Well done Russel Norman and the Greens for again taking this particular bull by the horns.

    They are highlighting the hypocricy of John Key again

  4. Tracey 4

    On planet key, tony ryall believes mums and dads in nz have brokers. watch the clip from tv3 and witness this wide eyed soundbite which neatly summarise who this govt is serving.

    good on norman for calling it.

    great billboard by the way…

  5. tc 5

    ‘Mum and dad investors’ joins the list of BS phrases along with higher standards, keeping your loved ones in nz, catching oz, brighter future etc

    A catchphrase is normally the precursor for a rogering as it stands out front of a planned set of actions and outcomes. Its the business approach where you craft a front full of slogans and behind it you slash, burn and pillage.

  6. kea 6

    What’s the betting that Key can maintain his veneer of enthusiasm during his third term ?

  7. Weepu's Beard 7

    The speed and nonchalance of the deal is disturbing. It’s like they’ve just given up on the mythical Mum and Dad investors (no glamorous advertising campaign) and have dealt straight with the institutions and foreign buyers.

    Horrifying to think this govt feels so secure that the’re not bothering to hide it this time.

  8. Tracey 8

    Four out of five independent research reports from investment houses in New Zealand and Australia value Genesis Energy shares at higher than the $1.55 a share offer price announced by government Ministers last Friday.

    The highest valuations, from Edison Investment Research and Craigs Investment Partners, suggest Genesis shares could be worth $1.97 apiece, while the most conservative valuation is from Australian research house Morningstar, which places a ‘fair value’ on the shares of $1.60.

    herald

  9. unitedtribes 9

    Well I guess the outcome of MRP would have been better for all concerned without the sabotage by David Cunliff and Russel Norman saying they would nationalise power. The shares are steadily improving in value as it looks more and more obvious those two will never get near it.

Links to post

Recent Comments

Recent Posts

  • Twenty highlights of 2020
    As we welcome in the new year, our focus is on continuing to keep New Zealanders safe and moving forward with our economic recovery. There’s a lot to get on with, but before we say a final goodbye to 2020, here’s a quick look back at some of the milestones ...
    3 weeks ago

  • Bay Cadets learn skills to protect environment
    Bay Conservation Cadets launched with first intake Supported with $3.5 million grant Part of $1.245b Jobs for Nature programme to accelerate recover from Covid Cadets will learn skills to protect and enhance environment Environment Minister David Parker today welcomed the first intake of cadets at the launch of the Bay ...
    BeehiveBy beehive.govt.nz
    10 hours ago
  • Cook Islanders to resume travel to New Zealand
    The Prime Minister of New Zealand Jacinda Ardern and the Prime Minister of the Cook Islands Mark Brown have announced passengers from the Cook Islands can resume quarantine-free travel into New Zealand from 21 January, enabling access to essential services such as health. “Following confirmation of the Cook Islands’ COVID ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • Supporting communities and landowners to grow employment opportunities
    Jobs for Nature funding is being made available to conservation groups and landowners to employ staff and contractors in a move aimed at boosting local biodiversity-focused projects, Conservation Minister Kiritapu Allan has announced. It is estimated some 400-plus jobs will be created with employment opportunities in ecology, restoration, trapping, ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Border exception for some returning international tertiary students
    The Government has approved an exception class for 1000 international tertiary students, degree level and above, who began their study in New Zealand but were caught offshore when border restrictions began. The exception will allow students to return to New Zealand in stages from April 2021. “Our top priority continues ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Tiwai deal gives time for managed transition
    Today’s deal between Meridian and Rio Tinto for the Tiwai smelter to remain open another four years provides time for a managed transition for Southland. “The deal provides welcome certainty to the Southland community by protecting jobs and incomes as the region plans for the future. The Government is committed ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • New member for APEC Business Advisory Council
    Prime Minister Jacinda Ardern has appointed Anna Curzon to the APEC Business Advisory Council (ABAC). The leader of each APEC economy appoints three private sector representatives to ABAC. ABAC provides advice to leaders annually on business priorities. “ABAC helps ensure that APEC’s work programme is informed by business community perspectives ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Govt’s careful economic management recognised
    The Government’s prudent fiscal management and strong policy programme in the face of the COVID-19 global pandemic have been acknowledged by the credit rating agency Fitch. Fitch has today affirmed New Zealand’s local currency rating at AA+ with a stable outlook and foreign currency rating at AA with a positive ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Additional actions to keep COVID-19 out of NZ
    The Government is putting in place a suite of additional actions to protect New Zealand from COVID-19, including new emerging variants, COVID-19 Response Minister Chris Hipkins said today. “Given the high rates of infection in many countries and evidence of the global spread of more transmissible variants, it’s clear that ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • 19 projects will clean up and protect waterways
    $36 million of Government funding alongside councils and others for 19 projects Investment will clean up and protect waterways and create local jobs Boots on the ground expected in Q2 of 2021 Funding part of the Jobs for Nature policy package A package of 19 projects will help clean up ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • New Zealand Government acknowledges 175th anniversary of Battle of Ruapekapeka
    The commemoration of the 175th anniversary of the Battle of Ruapekapeka represents an opportunity for all New Zealanders to reflect on the role these conflicts have had in creating our modern nation, says Associate Minister for Arts, Culture and Heritage Kiri Allan. “The Battle at Te Ruapekapeka Pā, which took ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Better care for babies with tongue-tie
    Babies born with tongue-tie will be assessed and treated consistently under new guidelines released by the Ministry of Health, Associate Minister of Health Dr Ayesha Verrall announced today. Around 5% to 10% of babies are born with a tongue-tie, or ankyloglossia, in New Zealand each year. At least half can ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Prisoner disorder event at Waikeria Prison over
    The prisoner disorder event at Waikeria Prison is over, with all remaining prisoners now safely and securely detained, Corrections Minister Kelvin Davis says. The majority of those involved in the event are members of the Mongols and Comancheros. Five of the men are deportees from Australia, with three subject to ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Pre-departure COVID-19 test for travellers from the UK and the US from 15 January
    Travellers from the United Kingdom or the United States bound for New Zealand will be required to get a negative test result for COVID-19 before departing, and work is underway to extend the requirement to other long haul flights to New Zealand, COVID-19 Response Minister Chris Hipkins confirmed today. “The new PCR test requirement, foreshadowed last ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • PM congratulates New Year Honour recipients
    Prime Minister Jacinda Ardern has added her warm congratulations to the New Zealanders recognised for their contributions to their communities and the country in the New Year 2021 Honours List. “The past year has been one that few of us could have imagined. In spite of all the things that ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • David Parker congratulates New Year 2021 Honours recipients
    Attorney-General and Minister for the Environment David Parker has congratulated two retired judges who have had their contributions to the country and their communities recognised in the New Year 2021 Honours list. The Hon Tony Randerson QC has been appointed a Companion of the New Zealand Order of Merit for ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • New Year’s Honours highlights outstanding Pacific leadership through challenging year
    Minister for Pacific Peoples Aupito William Sio says the New Year’s Honours List 2021 highlights again the outstanding contribution made by Pacific people across Aotearoa. “We are acknowledging the work of 13 Pacific leaders in the New Year’s Honours, representing a number of sectors including health, education, community, sports, the ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • Supporting seniors to embrace technology
    The Government’s investment in digital literacy training for seniors has led to more than 250 people participating so far, helping them stay connected. “COVID-19 has meant older New Zealanders are showing more interest in learning how to use technology like Zoom and Skype so they can to keep in touch ...
    BeehiveBy beehive.govt.nz
    3 weeks ago