Investors shrugged off any concern about the political future as large volumes of Meridian shares were traded after the country's largest energy company listed on the NZX yesterday.
By 5pm, more than 228 million shares had been traded with a day high of $1.09 and day low of $1.05. The average trade was 190,000 shares, but some parcels were as high as 3.5 million, pushing the NZX to one of its highest recent trading days.
Brokers said there were some large trades made through the day but it was unclear whether institutions were topping up their stakes or whether large private investors were seeking more of a stake.
It would take a week before the shares settled into a steady trading pattern, brokers said.
Meridian Energy's instalment receipts debuted at $1.08, an 8% premium, after tepid demand in the initial public offering resulted in the stock being sold at the bottom end of its indicative range and with a smaller-than-expected pool of investors.
The shares were offered in instalment receipts to sweeten the offer, with $1 upfront and the promise of full entitlement to dividends, and the remaining 50c in May 2015.
The float will raise $1.88 billion after the two instalment payment programme completes in 2015. They recently traded at $1.07 with about 80 million shares changing hands in the first 30 minutes.
''Given the uncertainty that still surrounds the electricity sector, the price is probably a fair call,'' Rickey Ward, head of equities at Tyndall Investment Management, which bought shares in the IPO, said.
''The changes that could occur under a Labour-Greens proposal, as well as Tiwai - the price has got some of those elements in it.''
Meridian has 2.56 billion shares on issue, of which 51% are controlled by the Government, leaving around 1.26 billion shares to be publicly traded.
The Government attracted about 62,000 New Zealanders to the sell-down of 49% of Meridian at $1.50 a share, the bottom of the indicative range of $1.50 to $1.80.
Demand for the shares was hurt by the risk posed by the Labour Greens policy to install a central buyer of power, effectively capping prices that could be charged for electricity.
The Green Party continued its campaign against asset sales yesterday, saying Treasury warned the Government it should not attempt to sell assets in quick succession because there would be insufficient demand and the revenue to the Crown would be reduced.
The uncertainty about the sale of power to the Tiwai Point aluminum smelter disappeared close to the listing as a new contract was negotiated with smelter owner Rio Tinto.
Also, if the smelter did close, analysts said the electricity could be sold into the national grid at a higher price than it was being sold to the smelter.
