Power NZ cleared to buy Energy Direct
The Commerce Commission today cleared Power New Zealand Limited to buy up to 100 percent of the shares of Energy Direct Corporation Limited.
Commission Chairman Alan Bollard said that after studying the proposal and extra information it had gathered, the Commission concluded the proposal would not result in any company gaining or strengthening a dominant position in any market.
The Commission's view is that the proposed acquisition would result in some aggregation in the national retail electricity market.
However, several other power companies and electricity retailing organisations would remain in the market. Furthermore, barriers to entry to this market would, in the Commission's view, remain unchanged by the proposed acquisition.
The Commission noted, in terms of electricity distribution markets, that Power New Zealand's and Energy Direct's networks had no common borders. The competitive constraints currently faced by the distributors would not be significantly reduced by the proposed acquisition.
Energy Direct is a Hutt Valley based electricity and gas utility. Power New Zealand is a company formed from the merger of Waitemata Electricity Limited and Valley Power Limited.
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