Mercury’s acquisition of Trustpower’s retail business goes unconditional

Mercury NZ’s acquisition of Trustpower’s retail business for the final acquisition price of $467 million is now unconditional, with completion expected on May 2.

The acquisition will double Mercury’s total customer connections and accelerate entry into the telecommunications market, with Mercury already heavily involved in renewable energy and e-mobility.

Trustpower’s retail business sells electricity, gas, fixed and wireless broadband, and mobile phone services, totalling about 416,000 connections. The combined business will have about 787,000 connections, creating New Zealand’s leading multi-product utilities retail business. 

The final acquisition price of $467m is made up of an underlying purchase price of $426m plus a working capital contribution of $41m. This is an increase in the price previously announced of $441m explained by a higher working capital contribution mostly due to Trustpower retaining its accounts payable obligations.

The acquisition of Trustpower’s retail business will enable Mercury to accelerate its retail strategy, delivering the right product mix and enhanced value for customers on a faster trajectory, says Mercury chief executive Vince Hawksworth.   

 “Going from a dual utility provider to a truly multi-product retailer adds material value for our customers in terms of convenience, cost efficiencies and the delivery of innovative and exciting products,” he says. 

“Multi-product bundling is a market where Trustpower has had great success and we know nearly half of Mercury customers like the idea of having a single utility provider.”

Greater scale will also allow Mercury to invest in the underlying technology platform, enabling better services and improved customer experience, Hawksworth says. 

“We want to provide a best-in-class customer experience, including frictionless interactions across multiple touchpoints, as we deliver new products and experiences.

“As New Zealand transitions to a low carbon economy, we want to ensure this shift is equitable for all consumers, including those experiencing hardship.

“Today is about welcoming around 570 new colleagues to Mercury, taking us to around 1400 employees nationwide. My executive team is growing too, with the addition of Fiona Smith, Trustpower’s general manager customer operations, and Paul Bacon, Trustpower’s general manager markets.”