The offer is expected to raise between $650 million and $900 million. The price indication is between $3.25 and $3.75 a share. That would give the company a market capitalisation of between $1.3 billion and $1.5 billion on listing.
Z Energy is owned by Infratil and the New Zealand Superannuation Funds. They indicated earlier this year that 50% to 60% of the company would be sold and confirmed that yesterday by lodging an offer document.
The offer will come at a time when the Government is considering down selling a 49% stake in state-owned electricity generator Meridian, the largest of the SOEs to be put up for sale.
There have been some suggestions that after the cool reception for Mighty River Power shares, which are trading below issue price, the Government may sell Meridian in two tranches.
Brokers spoken to yesterday said there was still room for good quality companies like Z Energy and Meridian.
''Our market is very small in relative terms, including compared to GDP. There has been heightened interest in the NZX because of low interest rates and the Government's push to have investments in things other than property.
With the growth of KiwiSaver funds, there will be interest in Z Energy. We don't want to be seen as a market of 'gentailers' and Z will provide an alternative,'' a broker said.
Another broker said pricing for both Z Energy and Meridian would be the key to the successful floating of the companies.
Infratil chief executive Marko Bogoievski said Z had strong cash flows, a good dividend outlook and had identified a range of potential future growth areas, including new retail service stations, customer offers and enhancements to Z's terminal infrastructure.
''This listing is an opportunity for investors to take a stake in a major infrastructure and retailing company that plays a significant role in keeping New Zealand's economy moving,'' he said.
Superannuation fund spokesman Stewart Brooks said Z had increased in value and now represented a significantly larger proportion of the fund that it did when purchased in 2010.
''Reducing our stake via a partial listing will help diversify the fund's investment portfolio, as well as adding depth to New Zealand's capital markets,'' he said.
Z would be New Zealand's first listed transport fuels company and was expected to be among the largest New Zealand companies on the NZX main board.
The company earlier this year reported annual operating earnings of $195 million.
Z chief executive Mike Bennetts said the registering of the offer document was positive for the company and New Zealand.
''When we established Z Energy, we set out to build a company that delivered what our customers told us they wanted and that invested in New Zealand's transport fuel supply infrastructure.''
Z made it clear that as a local company, it was committed to a different way of doing business, he said.
At a glance
Z Energy to list on August 22
Sell down of between 50% and 60% of company
Infratil and NZ Super Fund to hold remaining shares
Share price between $3.25 and $3.75
Market capitalisation of between $1.3 billion and $1.5 billion
