Trust Ownership Review
In 1992, the directors of the Central Hawke’s Bay Power Board consulted the community about shareholding options and the local response favoured trust ownership, so in 1993 a trust was formed to hold the shares. Today, all the shares in Centralines Limited are held by the Central Hawke’s Bay Consumer Power Trust (CHBCPT) for the benefit of electricity consumers in Central Hawke’s Bay.
According to the Trust Deed, every five years Trustees of the Central Hawke’s Bay Consumers Power Trust must review the ownership options and present the review to consumers. The review will assess the performance of the Trust over the last five years and will make a recommendation as to how the shares should continue to be held.
As part of the review, we are seeking your views about the future of Centralines’ ownership. We would like your opinion on the current form of ownership compared to other possible forms of ownership.
We will begin by explaining some of the basic differences between various ownership options, then we will ask you to complete and submit an online form indicating your preferred option. If you would like more information about the options, please contact one of the Trustees before you answer the question. This is an important issue, and your answers need to be based on good information and a good understanding of the options.
THE POSSIBLE OWNERSHIP OPTIONS:
1. Trust Ownership
This is the system we have now. 100% consumer trust ownership ensures the control of Centralines remains with current and future consumers in Central Hawke’s Bay. This means the needs of consumers can be reflected in the Company’s strategic objectives. This option provides Centralines with flexibility to respond to new opportunities (subject to available capital and shareholder approval) and is a simple model with minimal administrative costs.
2. Asset distribution to consumer beneficiaries
An alternative ownership option is for the shares in Centralines to be distributed to consumer beneficiaries. This would distribute the full value of the Company into the local community, with the benefits going to current consumers. Future and former consumers would miss out. In practice, many consumers would likely sell their shares to private or institutional investors and local control of the Company would be lost.
3. Sale of shares to the public or other investors
An alternative is to sell the shares in the Company to the public, or other investors which could include institutional investors, other electricity distribution businesses, or energy trusts. This option would raise capital, which the Trust is required to hold and invest in government bonds or bank deposits, until it is distributed to beneficiaries.
As a consumer trust, CHBCPT could only use funds raised by selling shares to invest in Centralines or its subsidiaries.
4. Merger or joint venture with another electricity distribution company
A merger or joint venture with another electricity distribution business is an option which the Company could take up, with the Trust’s approval. Under this option, the Trust’s ownership is diluted, but some influence over the performance and objectives of the Company is retained. This option could be used to provide access to more scale and expertise or additional capital for growth and new business activities.
Read the Central Hawke’s Bay Consumer Power Trust Ownership Review Report below.
YOUR VIEWS
While the Central Hawke's Bay Consumers Power Trust supports maintaining the present ownership model, we want to consider your views.
To tell us what your preferred ownership option is, please complete and submit the online form below by 4.00pm on Monday 15 April 2024.
Alternatively, you can complete and submit a hard copy form at Centralines reception, 17 Coughlan Road, Waipukurau, between 8am-4pm from Monday to Friday. Any forms received after 4.00pm on Monday 15 April 2024 cannot be considered.