A local consortium of infrastructure investor Infratil Ltd and New Zealand’s state pension fund has signed a signed a letter of intent with Shell New Zealand, a unit of Royal Dutch Shell PLC for the potential acquisition.
The consortium parties said on Monday that the letter of intent was not a sales contract, but represented the “clear intention to proceed to acquire Shell’s New Zealand downstream assets if relevant pre-requisites are met including the securing of third-party approvals.”
Infratil has said it expects the acquisition process to complete early in 2010.
The assets include Shell New Zealand’s entire downstream assets, comprising around 230 retail stations, marine, bitumen, aviation, commercial fuels and chemicals businesses, and a supply and distribution business.
It also includes a 17.1% stake in New Zealand Refining Co. where Shell is the third-biggest shareholder. The plant is said to produce all the marine fuel for New Zealand’s bunker market.
Shell put its New Zealand downstream business on the market earlier this year following a review.
A purchase price is reported to have been agreed, but has not been disclosed. Local media have put the expected value at about NZ$1 billion ($710 million).