Z Energy invests in Flick Electric

Z Energy is putting up $46 million for a 70.1% shareholding in Flick Electric.

That’s expected to help Z meet New Zealand’s transition to electric vehicles and diversify into renewable energy.

Wellington based retail electricity supplier Flick offers customers wholesale electricity prices.

The investment brings together an electricity industry disruptor and New Zealand’s largest transport energy company, Z Energy reports.

The companies will be focused on maximising the innovation potential of the energy sector as it transitions to a lower carbon future, Z chief executive Mike Bennetts says.

“We view this as a partnership that brings together Flick’s start-up mentality, differentiated offer, technology and talent, along with Z’s innovation and marketing capability, operational scale and resources,” he says.

“We are continuously assessing options to invest and extend into adjacencies in one of our three preferred market spaces – future fuels, mobility and the last mile.”

Z’s investment will help Flick realise its potential, Flick chief executive officer Steve O’Connor says.

“Over the past four years we’ve proven there’s an appetite for a new engagement model in energy retail, which has entrenched our vision to bring disruptive energy technologies to as many people as possible. This partnership, and the expertise and capital it brings to Flick, will allow us to do more, faster, and have a greater impact on New Zealanders’ lives.”

Z Energy will pay an initial consideration of $15.6 million for 22% of Flick in new issued capital and an additional $30.4 million for the purchase of an additional 48.1% of existing shares to take the total shareholding to 70.1%.

In the next quarter the governance of Flick will change to reflect Z’s majority shareholding position.

Z Energy will use existing credit facilities to fund the investment and says the transaction will not impact current FY19 earnings or dividend guidance. It expects the investment in Flick Electric to be earnings accretive from the 2021 financial year.