1 00:00:00,080 --> 00:00:03,040 Speaker 1: The onshore wind resource in New Zealand is the best 2 00:00:03,080 --> 00:00:05,000 Speaker 1: in the world. We think it's the best wind site 3 00:00:05,000 --> 00:00:07,400 Speaker 1: in the country. Most other wind farms in New Zealand 4 00:00:07,480 --> 00:00:10,080 Speaker 1: thirty five to forty forty five. Maybe this is fifty 5 00:00:10,119 --> 00:00:12,920 Speaker 1: percent plus, so's it's an exceptional wind sit. 6 00:00:13,240 --> 00:00:15,680 Speaker 2: It's an independent wind generator, so it's not tied to 7 00:00:16,360 --> 00:00:19,520 Speaker 2: the gentailis for example. It's also a pure play on 8 00:00:19,640 --> 00:00:20,280 Speaker 2: wind energy. 9 00:00:20,360 --> 00:00:24,000 Speaker 1: Of climate change, we're likely to get more rain into 10 00:00:24,040 --> 00:00:27,240 Speaker 1: where the hydro catchments are in this country and more 11 00:00:27,320 --> 00:00:30,160 Speaker 1: wind into those areas that we're building wind farms. 12 00:00:33,720 --> 00:00:36,839 Speaker 3: Curer and welcome to shed Lunch, brought to you by Shasis. 13 00:00:37,240 --> 00:00:40,279 Speaker 3: I'm Helen Madison, and today we take a look at 14 00:00:40,280 --> 00:00:43,520 Speaker 3: the takeover offer for New Zealand Wind Farms by Gen 15 00:00:43,640 --> 00:00:48,080 Speaker 3: Taylor Meridian. If you haven't heard, this share offer represented 16 00:00:48,440 --> 00:00:51,920 Speaker 3: a value of ninety one million dollars and a premium 17 00:00:51,960 --> 00:00:54,520 Speaker 3: of one hundred and seven percent to the company's share 18 00:00:54,560 --> 00:00:57,440 Speaker 3: price at the close of trading on febru the eighteenth. 19 00:00:58,040 --> 00:01:00,600 Speaker 3: There are a number of things riding on this, including 20 00:01:00,600 --> 00:01:04,240 Speaker 3: a shareholder vote in May and High court approval. Are 21 00:01:04,280 --> 00:01:06,399 Speaker 3: we talking to both the chair of New Zealand Wind 22 00:01:06,440 --> 00:01:10,480 Speaker 3: Farms Craig Stobo and Meridium CEO Neil Barclay to get 23 00:01:10,480 --> 00:01:14,240 Speaker 3: the picture for investors about what the steel means. Before 24 00:01:14,240 --> 00:01:16,640 Speaker 3: we get started, here's some important information. 25 00:01:17,440 --> 00:01:20,039 Speaker 4: Investing involves the risk you might lose the money you 26 00:01:20,080 --> 00:01:23,400 Speaker 4: start with. We recommend talking to a licensed financial advisor. 27 00:01:24,080 --> 00:01:27,920 Speaker 4: We also recommend reading product disclosure documents before deciding to invest. 28 00:01:28,200 --> 00:01:30,600 Speaker 4: Everything you're about to see and here is current at 29 00:01:30,600 --> 00:01:31,440 Speaker 4: the time of recording. 30 00:01:32,040 --> 00:01:34,000 Speaker 3: Welcome Craig. Great to have you in the studio, Thanks 31 00:01:34,000 --> 00:01:34,480 Speaker 3: for coming in. 32 00:01:34,600 --> 00:01:35,880 Speaker 2: Good morning to you, Thank you for having me. 33 00:01:36,520 --> 00:01:39,640 Speaker 3: Now, the market seems to have quite liked the Meridian 34 00:01:39,720 --> 00:01:42,800 Speaker 3: offer for New Zealand Wind Farms. The share price doubled. 35 00:01:43,160 --> 00:01:45,440 Speaker 3: Probably fair to say it's been in the doul drums 36 00:01:45,480 --> 00:01:47,840 Speaker 3: a little. Did you have any idea what to. 37 00:01:47,840 --> 00:01:51,760 Speaker 2: Expect, well know, in the sense of how the market 38 00:01:51,800 --> 00:01:54,000 Speaker 2: would exactly react, But you're right. It went from twelve 39 00:01:54,040 --> 00:01:56,920 Speaker 2: point one cents the day before then the announcement was 40 00:01:56,920 --> 00:01:59,480 Speaker 2: twenty five cents, and it sprint it up to around 41 00:01:59,560 --> 00:02:01,600 Speaker 2: twenty three twenty three and a half, so one hundred 42 00:02:01,600 --> 00:02:04,920 Speaker 2: and seventy percent from the day before. But of course 43 00:02:04,960 --> 00:02:07,880 Speaker 2: the market then takes a view on the certainty of 44 00:02:07,880 --> 00:02:10,680 Speaker 2: that transaction, so they don't quite go to twenty five cents. 45 00:02:10,680 --> 00:02:12,520 Speaker 2: They go to twenty three to twenty and a half 46 00:02:12,639 --> 00:02:15,880 Speaker 2: until they get more information, which is still forthcoming. So 47 00:02:16,000 --> 00:02:18,640 Speaker 2: expect the share price to hang around the until we 48 00:02:18,680 --> 00:02:19,800 Speaker 2: get certainty of the outcome. 49 00:02:20,240 --> 00:02:23,280 Speaker 3: We've got about twenty thousand investors on shares ease, which 50 00:02:23,400 --> 00:02:25,560 Speaker 3: is about twelve percent. I think of your register, which 51 00:02:25,600 --> 00:02:29,080 Speaker 3: is a fair chunk for a retail block. What do 52 00:02:29,120 --> 00:02:32,360 Speaker 3: you think they brought into New Zealand wind Farms. There's 53 00:02:32,400 --> 00:02:34,359 Speaker 3: quite a few loyal people that have been there for 54 00:02:34,440 --> 00:02:36,600 Speaker 3: quite sometime. Why do you think it was attractive? 55 00:02:37,240 --> 00:02:39,359 Speaker 2: I think people came in with a couple of reasons. 56 00:02:39,360 --> 00:02:41,960 Speaker 2: One is it's an independent wind generator, so it's not 57 00:02:42,000 --> 00:02:45,440 Speaker 2: tied to the gent tailors for example. It's also a 58 00:02:45,440 --> 00:02:49,200 Speaker 2: pure play on wind energy, and it's close to people. 59 00:02:49,240 --> 00:02:52,320 Speaker 2: You can see the site, you can see the changes 60 00:02:52,360 --> 00:02:54,400 Speaker 2: that are going on, and it's a very small company 61 00:02:54,480 --> 00:02:57,600 Speaker 2: and it's pretty much four directors and roughly twelve staff, 62 00:02:57,639 --> 00:03:00,240 Speaker 2: so it's you can wrap your head around what they're 63 00:03:00,240 --> 00:03:02,600 Speaker 2: trying to do. It's pretty simple to understand. People came 64 00:03:02,639 --> 00:03:05,320 Speaker 2: in Originally all of them have come in for the dividends, 65 00:03:05,800 --> 00:03:07,920 Speaker 2: but we signaled a couple of years ago that we 66 00:03:07,919 --> 00:03:11,560 Speaker 2: were moving into a development mode and we ceased paying dividends. 67 00:03:11,560 --> 00:03:14,080 Speaker 2: That upset a few of our investors, including the Chares. 68 00:03:14,080 --> 00:03:16,720 Speaker 2: These investors but were very clear that we could not 69 00:03:16,800 --> 00:03:20,000 Speaker 2: stay where we were. We had to redevelop the existing 70 00:03:20,480 --> 00:03:24,040 Speaker 2: two blade turbines. As they age and they don't have 71 00:03:25,280 --> 00:03:27,480 Speaker 2: a management contract, we can go and get new parts 72 00:03:27,520 --> 00:03:32,040 Speaker 2: because it's original technology which finishes and ceases. We's out 73 00:03:32,360 --> 00:03:35,560 Speaker 2: in the twenty thirties or thereabout, so we had to 74 00:03:35,600 --> 00:03:38,440 Speaker 2: make a decision to refurbish those or to go for 75 00:03:38,480 --> 00:03:40,920 Speaker 2: a larger development, and we went for a larger development, 76 00:03:41,080 --> 00:03:44,760 Speaker 2: and hence we paused dividends and then announced this major 77 00:03:44,800 --> 00:03:48,800 Speaker 2: transaction with Meridian as our partner, which gave you one 78 00:03:48,840 --> 00:03:51,400 Speaker 2: confidence that the pathway could be achieved with a very 79 00:03:51,400 --> 00:03:55,400 Speaker 2: good partner and availability of capital and project expertise. 80 00:03:55,640 --> 00:03:57,880 Speaker 3: So it's just clarify there. So you've got a joint 81 00:03:57,960 --> 00:04:03,320 Speaker 3: venture with Meridian to repower extend to really Hoe. Now 82 00:04:03,360 --> 00:04:07,240 Speaker 3: to really Hoe is your biggest asset pretty much, and 83 00:04:07,280 --> 00:04:10,120 Speaker 3: obviously what Meridian will get all the energy from you know, 84 00:04:10,160 --> 00:04:13,880 Speaker 3: once it's redone. Now that's that's a pretty big undertaking 85 00:04:14,160 --> 00:04:16,640 Speaker 3: and you needed, obviously their help to do that. I 86 00:04:16,680 --> 00:04:20,440 Speaker 3: think it's over six hundred million. Would this upgrade be 87 00:04:20,560 --> 00:04:21,720 Speaker 3: possible without. 88 00:04:21,400 --> 00:04:28,200 Speaker 2: Meridian and our view know, because we're at that stage, 89 00:04:28,240 --> 00:04:32,000 Speaker 2: a forty million dollar valued company on the New Zealand 90 00:04:32,000 --> 00:04:35,240 Speaker 2: Exchange with a five to fifty million dollar project in 91 00:04:35,240 --> 00:04:38,920 Speaker 2: front of us. So we needed partners at several levels. 92 00:04:38,920 --> 00:04:42,240 Speaker 2: We needed partners who would agree to buy the power 93 00:04:42,320 --> 00:04:43,880 Speaker 2: at the end of the project, which is called a 94 00:04:43,880 --> 00:04:47,280 Speaker 2: power purchased agreement a PPA. And we needed someone to 95 00:04:47,360 --> 00:04:50,240 Speaker 2: co invest with us in the project. So needed to 96 00:04:50,279 --> 00:04:54,120 Speaker 2: be someone who could guarantee the power off take at 97 00:04:54,120 --> 00:04:56,599 Speaker 2: the end and who had the skills to help develop 98 00:04:56,640 --> 00:04:59,560 Speaker 2: the project. As that decision was made, we went to 99 00:04:59,680 --> 00:05:03,279 Speaker 2: an ur request for proposals to the marketplace and Meridian 100 00:05:03,360 --> 00:05:07,760 Speaker 2: came back worth a ten plus five off take agreement 101 00:05:07,760 --> 00:05:09,120 Speaker 2: for the power at the end of the project. 102 00:05:09,279 --> 00:05:11,120 Speaker 3: What does that mean? Ten plus five so ten. 103 00:05:11,040 --> 00:05:14,040 Speaker 2: Years plus five more years, so fifteen years of guaranteed 104 00:05:14,080 --> 00:05:16,000 Speaker 2: off take of the power from the. 105 00:05:16,080 --> 00:05:18,280 Speaker 3: And that's all of the powers. 106 00:05:18,640 --> 00:05:21,360 Speaker 2: And that's really important because if you get a credit 107 00:05:21,400 --> 00:05:25,960 Speaker 2: worthy purchaser of the power generated by the site. When 108 00:05:25,960 --> 00:05:29,200 Speaker 2: the project starts for ten to fifteen years, it means 109 00:05:29,200 --> 00:05:32,160 Speaker 2: it's very bankable as a project. So banks are saying, well, 110 00:05:32,160 --> 00:05:35,159 Speaker 2: i've got security of revenue coming through, I'm happy to 111 00:05:35,160 --> 00:05:37,279 Speaker 2: make a loan to the company or the JV in 112 00:05:37,279 --> 00:05:40,039 Speaker 2: this case to be able to facilitate the development of 113 00:05:40,040 --> 00:05:43,200 Speaker 2: the project. And so those projects can be quite highly geared, 114 00:05:43,720 --> 00:05:45,320 Speaker 2: so you can have a lot of debt in those 115 00:05:45,360 --> 00:05:48,800 Speaker 2: projects because of the security of that revenue stream. So 116 00:05:48,839 --> 00:05:51,440 Speaker 2: that was very, very important. In addition, the partner had 117 00:05:51,440 --> 00:05:54,840 Speaker 2: to demonstrate that they could develop the wind farm with us, 118 00:05:54,920 --> 00:05:58,400 Speaker 2: and as it turns out, Meridian had been completing Harder 119 00:05:58,480 --> 00:06:01,640 Speaker 2: Pucky further up the Spine North Island with another wind 120 00:06:01,680 --> 00:06:04,039 Speaker 2: farm development, so they had credentials in development and they 121 00:06:04,080 --> 00:06:07,000 Speaker 2: knew the logistics of trying to get a new farm 122 00:06:07,440 --> 00:06:09,960 Speaker 2: or extension up and running. And at the same time 123 00:06:10,320 --> 00:06:12,159 Speaker 2: they said, well, we'll do all that, but we'd like 124 00:06:12,200 --> 00:06:14,640 Speaker 2: to buy nineteen point nine to nine percent of the 125 00:06:14,680 --> 00:06:17,880 Speaker 2: shares in your company. So we issued new shares with 126 00:06:17,920 --> 00:06:20,640 Speaker 2: the Concenter shareholders to allow them to come in and 127 00:06:20,680 --> 00:06:24,800 Speaker 2: become a real partner. Across several layers, and so they 128 00:06:24,839 --> 00:06:27,520 Speaker 2: are able to provide us for the expertise for that 129 00:06:27,640 --> 00:06:30,440 Speaker 2: part of the project for their fifty percent, then we 130 00:06:30,440 --> 00:06:33,359 Speaker 2: had our fifty percent, which is still a big amount 131 00:06:33,400 --> 00:06:35,520 Speaker 2: of money for us to raise. So we were in 132 00:06:35,560 --> 00:06:40,760 Speaker 2: the project process of also inviting equity participants to come 133 00:06:40,760 --> 00:06:43,919 Speaker 2: in from around the world, and we've got amazing responses 134 00:06:43,960 --> 00:06:46,320 Speaker 2: for those, and so we're going down the track of 135 00:06:47,120 --> 00:06:52,240 Speaker 2: looking at crafting the final terms of what the equity 136 00:06:52,240 --> 00:06:55,279 Speaker 2: providers could give to us. When Meridian popped up and said, well, 137 00:06:55,320 --> 00:06:58,279 Speaker 2: actually we like the whole thing, so can we buy 138 00:06:58,360 --> 00:07:01,880 Speaker 2: all of your shares please twenty five cents And we 139 00:07:01,920 --> 00:07:04,159 Speaker 2: announced that to the market after we've done our own 140 00:07:04,560 --> 00:07:08,760 Speaker 2: internal thinking about what was a fair price for the 141 00:07:08,800 --> 00:07:11,080 Speaker 2: company and what was in the best interest of our 142 00:07:11,160 --> 00:07:14,960 Speaker 2: shareholders because we have choices to stay and develop with 143 00:07:15,000 --> 00:07:17,400 Speaker 2: all the risks associated with that, or we can take 144 00:07:17,440 --> 00:07:20,680 Speaker 2: a price today which recognizes all the work that the 145 00:07:20,760 --> 00:07:23,880 Speaker 2: board and the management team had done to get to 146 00:07:23,960 --> 00:07:26,560 Speaker 2: this point, which was around all the risks that have 147 00:07:26,640 --> 00:07:29,480 Speaker 2: to be managed and then the logistics to get to 148 00:07:29,760 --> 00:07:32,760 Speaker 2: a final investment decision. And when you weigh those two 149 00:07:32,800 --> 00:07:35,080 Speaker 2: things up, the board decided that it was in the 150 00:07:35,120 --> 00:07:38,640 Speaker 2: best interests of shareholders to take the money today twenty 151 00:07:38,640 --> 00:07:41,520 Speaker 2: five cents, so that's why the share price jumped so 152 00:07:41,600 --> 00:07:44,480 Speaker 2: quickly from twelve point one to roughly twenty three cents today. 153 00:07:44,920 --> 00:07:46,640 Speaker 2: So we have to go through a few things though, 154 00:07:47,080 --> 00:07:49,880 Speaker 2: to get to that shareholder vote, which is required. We 155 00:07:49,920 --> 00:07:53,640 Speaker 2: need to get an independent appraisal so evaluation report, which 156 00:07:53,640 --> 00:07:57,320 Speaker 2: would tell us tell us the company, the board and 157 00:07:57,520 --> 00:08:00,600 Speaker 2: shareholders that this is in the best of the company 158 00:08:01,000 --> 00:08:04,240 Speaker 2: because the share price offered reflects the value that the 159 00:08:04,320 --> 00:08:07,320 Speaker 2: valuer thinks company's worth, and they'll give us a range, 160 00:08:07,320 --> 00:08:09,960 Speaker 2: I assume, like they do with other reports. A. Secondly, 161 00:08:10,080 --> 00:08:12,600 Speaker 2: we've got to go through a process that's signed off 162 00:08:12,600 --> 00:08:14,960 Speaker 2: by the court, so you have certain documentation you have 163 00:08:15,000 --> 00:08:16,960 Speaker 2: to get out and we hope to get that out 164 00:08:17,240 --> 00:08:19,360 Speaker 2: in the next few weeks and then there'll be a 165 00:08:19,360 --> 00:08:24,800 Speaker 2: shareholder vote, hopefully in duing quarter. We're going as fast 166 00:08:24,800 --> 00:08:28,360 Speaker 2: as we can, but that's the current timetable. So yes, 167 00:08:28,480 --> 00:08:31,120 Speaker 2: it's it's a it's a process of thinking about your 168 00:08:31,120 --> 00:08:33,600 Speaker 2: shareholders and what's in their best interests. 169 00:08:33,559 --> 00:08:36,040 Speaker 3: And you think this is better for them, I mean, 170 00:08:36,040 --> 00:08:38,679 Speaker 3: you will be no longer the last or you will 171 00:08:38,679 --> 00:08:40,360 Speaker 3: be the last independent. 172 00:08:40,240 --> 00:08:41,880 Speaker 2: Well, and it's not. It's not quite it's quite not 173 00:08:42,000 --> 00:08:44,360 Speaker 2: quite true. I mean, there's several ways to think about this. 174 00:08:44,440 --> 00:08:48,000 Speaker 2: The project keeps going. It's just done by Meridium, so 175 00:08:48,200 --> 00:08:50,800 Speaker 2: you know, in terms of the generation needs of the country, 176 00:08:50,880 --> 00:08:53,160 Speaker 2: it continues, it's just not done by New Zealand wind farms. 177 00:08:54,559 --> 00:08:57,640 Speaker 2: But in terms of other independence, there's obviously the Manua 178 00:08:58,200 --> 00:09:04,880 Speaker 2: are independent but are subject to it's a Commerce Commission issue, clearly. 179 00:09:04,960 --> 00:09:07,240 Speaker 2: But there's also Pioneer Energy in the South Island. I mean, 180 00:09:07,280 --> 00:09:09,800 Speaker 2: so there are independents around there are still Okay, yeah, 181 00:09:10,280 --> 00:09:12,280 Speaker 2: they're not listed. It's like it's probably what you're trying 182 00:09:12,320 --> 00:09:15,800 Speaker 2: to say is that we don't have many listed independent 183 00:09:18,120 --> 00:09:22,000 Speaker 2: renewable enerjury companies, but there are privately owned renewable companies 184 00:09:22,000 --> 00:09:24,559 Speaker 2: in the for example, the solar space, and if you 185 00:09:24,600 --> 00:09:26,520 Speaker 2: look at the Transper website, there is a long list 186 00:09:26,559 --> 00:09:31,360 Speaker 2: of possible projects yet to come to fruition. So I 187 00:09:31,360 --> 00:09:33,600 Speaker 2: wouldn't rule out the possibility of others coming to the 188 00:09:33,600 --> 00:09:37,720 Speaker 2: market if they think that's the best thing for a 189 00:09:37,720 --> 00:09:40,679 Speaker 2: liquidity event. But you're right, at the moment we are 190 00:09:40,760 --> 00:09:44,560 Speaker 2: the last independent listed one generator you know, so there's 191 00:09:44,640 --> 00:09:46,520 Speaker 2: choices depending on your motivation to come up to New 192 00:09:46,600 --> 00:09:49,920 Speaker 2: Zealand wind Farms. Was it the renewable play? Well, okay, 193 00:09:49,960 --> 00:09:51,480 Speaker 2: you can continue with that. It's not going to be 194 00:09:51,520 --> 00:09:53,800 Speaker 2: a small company play. It'll be the Meridian play, which 195 00:09:53,840 --> 00:09:57,320 Speaker 2: is you know, it's a very large listed entity on 196 00:09:57,320 --> 00:09:57,920 Speaker 2: the stocks change. 197 00:09:58,000 --> 00:10:00,319 Speaker 3: Quite different. Yeah, Gentaylor compared to go. 198 00:10:00,360 --> 00:10:03,320 Speaker 2: As Gentata, so it's combined. You're right, it's not a 199 00:10:03,360 --> 00:10:06,120 Speaker 2: pure production play. It has retail as well. I know 200 00:10:06,120 --> 00:10:06,560 Speaker 2: you're right. 201 00:10:06,880 --> 00:10:08,640 Speaker 3: There are a few hopes to jump through. As you've 202 00:10:08,720 --> 00:10:12,199 Speaker 3: just explained, what if it fails, what's the plan? So 203 00:10:12,280 --> 00:10:13,120 Speaker 3: we've compilated that. 204 00:10:13,200 --> 00:10:15,680 Speaker 2: So that would require us to go back to where 205 00:10:15,679 --> 00:10:19,760 Speaker 2: we are today head of all this process, and that 206 00:10:19,800 --> 00:10:24,640 Speaker 2: would mean well, our view is that if the twenty 207 00:10:24,640 --> 00:10:26,200 Speaker 2: five cents is not an off of, the share price 208 00:10:26,200 --> 00:10:28,360 Speaker 2: won't be at twenty three cents. So that's one thing. 209 00:10:28,600 --> 00:10:30,360 Speaker 2: Of course, people are at the share prices at twenty 210 00:10:30,360 --> 00:10:32,360 Speaker 2: three cents or so today because of the prospect of 211 00:10:32,400 --> 00:10:35,400 Speaker 2: twenty five cents in Dune quarter, So that would change. 212 00:10:35,440 --> 00:10:37,960 Speaker 2: I think secondly, we would have to go back to 213 00:10:39,320 --> 00:10:43,000 Speaker 2: contemplating how we would raise dead inequity again. For our 214 00:10:43,040 --> 00:10:46,560 Speaker 2: share of the project, and we've just in discussions with Meridian, 215 00:10:46,960 --> 00:10:50,280 Speaker 2: agreed that if that was to happen, Meridian would fund 216 00:10:51,000 --> 00:10:53,960 Speaker 2: our half of our fifty percent. So Meridian's got fifty 217 00:10:53,960 --> 00:10:56,280 Speaker 2: percent of the project, we've got fifty percent. We need 218 00:10:56,280 --> 00:10:59,040 Speaker 2: to fund half of our fifty percent, and so they've 219 00:10:59,080 --> 00:11:01,920 Speaker 2: agreed for nine point eight million dollars to come in 220 00:11:01,960 --> 00:11:03,840 Speaker 2: and fund that. Now that's not our view of the 221 00:11:03,960 --> 00:11:07,000 Speaker 2: value of that slice of our business, but it's a 222 00:11:07,080 --> 00:11:10,200 Speaker 2: backup so that we can fund what we need to do. 223 00:11:10,880 --> 00:11:12,800 Speaker 2: But it does mean down the track we'll need to 224 00:11:12,800 --> 00:11:14,800 Speaker 2: go to the sheer market again to raise more capital. 225 00:11:15,000 --> 00:11:16,520 Speaker 3: Yeah, because that nine point eight. 226 00:11:16,320 --> 00:11:18,920 Speaker 2: Million that covers us for our you know. 227 00:11:19,000 --> 00:11:21,160 Speaker 3: We're near what's going to cost us it though. 228 00:11:21,520 --> 00:11:25,120 Speaker 2: Well, it gets us, it gets us through the initial 229 00:11:25,480 --> 00:11:27,920 Speaker 2: initial stages, but we still need we still need bank 230 00:11:28,120 --> 00:11:30,440 Speaker 2: project debt, all those other things need to happen. So 231 00:11:30,840 --> 00:11:33,880 Speaker 2: it's a it's a more difficult outcome in the sense 232 00:11:33,920 --> 00:11:37,199 Speaker 2: that it doesn't value and our view value that fifty 233 00:11:37,200 --> 00:11:41,760 Speaker 2: percent as much as the twenty five cents does. But 234 00:11:41,920 --> 00:11:44,800 Speaker 2: it means we can continue and live another day and 235 00:11:44,880 --> 00:11:48,080 Speaker 2: go out to the marketplace as we develop the other 236 00:11:48,200 --> 00:11:50,960 Speaker 2: parts of our portfolio, how Nui in the South wai 237 00:11:51,040 --> 00:11:53,439 Speaker 2: Rapa or other other development projects that are on the 238 00:11:53,440 --> 00:11:54,120 Speaker 2: foot at the moment. 239 00:11:55,000 --> 00:11:57,520 Speaker 3: So how Nui that was what you brought from Genesis 240 00:11:57,559 --> 00:12:00,720 Speaker 3: back in October twenty twenty four. How does that compare 241 00:12:00,800 --> 00:12:01,120 Speaker 3: to this. 242 00:12:01,960 --> 00:12:04,600 Speaker 2: Well, it's another development opportunity in our view. So it 243 00:12:04,679 --> 00:12:09,320 Speaker 2: has only twelve percent of the output of our current 244 00:12:09,440 --> 00:12:12,760 Speaker 2: wind farm at to rehow so not the redevelopment one 245 00:12:12,800 --> 00:12:16,439 Speaker 2: but the existing one. So it's small, but it has 246 00:12:16,520 --> 00:12:22,320 Speaker 2: development possibilities to upgrade the existing Ennicon turbines and put 247 00:12:22,440 --> 00:12:26,679 Speaker 2: and put more turbines on the same site. So we 248 00:12:26,720 --> 00:12:29,800 Speaker 2: saw that as a great opportunity to improve the economics 249 00:12:29,840 --> 00:12:33,160 Speaker 2: of that site. And it was an asset that Genesis 250 00:12:33,160 --> 00:12:35,360 Speaker 2: clear didn't want and so I'm very happy to take 251 00:12:35,400 --> 00:12:38,920 Speaker 2: it over, which was a great a great acquisition for 252 00:12:39,040 --> 00:12:41,360 Speaker 2: us Q four last year. 253 00:12:41,480 --> 00:12:44,240 Speaker 3: But doesn't Genesis get the power from that site? So 254 00:12:44,280 --> 00:12:46,520 Speaker 3: what will happen if Meridian does well? 255 00:12:46,520 --> 00:12:48,840 Speaker 2: They have a contract with us, so the contract stays. 256 00:12:48,640 --> 00:12:52,600 Speaker 3: In place, right, So even though Meridian would potentially buy 257 00:12:52,720 --> 00:12:57,079 Speaker 3: New Zealand wind farms, then they would be supplying Genesis 258 00:12:57,120 --> 00:12:58,319 Speaker 3: with power. 259 00:12:58,080 --> 00:13:00,319 Speaker 2: From that absolutely just. 260 00:13:00,280 --> 00:13:02,440 Speaker 3: To finish off what would be your message for and 261 00:13:02,520 --> 00:13:05,120 Speaker 3: using wind Farm investors. 262 00:13:05,880 --> 00:13:11,120 Speaker 2: So at this point in our history of the company, 263 00:13:11,840 --> 00:13:14,000 Speaker 2: we have a twenty five cent offer from Meridian in 264 00:13:14,000 --> 00:13:18,079 Speaker 2: front of us to purchase all the shares from our 265 00:13:18,080 --> 00:13:21,400 Speaker 2: shareholders at twenty five cents as we go through this 266 00:13:22,720 --> 00:13:26,640 Speaker 2: scheme of arrangement process in that in the documentation that 267 00:13:26,640 --> 00:13:29,840 Speaker 2: will be pros and cons given to investors around why 268 00:13:29,880 --> 00:13:32,280 Speaker 2: you should or while you should not. But the question 269 00:13:32,360 --> 00:13:36,439 Speaker 2: in our minds was the relative risks of both cash 270 00:13:36,480 --> 00:13:38,960 Speaker 2: in the hand at twenty five cents, which we'll see 271 00:13:38,960 --> 00:13:41,439 Speaker 2: what the independent value sees, but in our view as 272 00:13:41,480 --> 00:13:44,839 Speaker 2: a fair price given all the work we've done today 273 00:13:45,000 --> 00:13:47,640 Speaker 2: to get the developments up to this point in time, 274 00:13:48,600 --> 00:13:51,400 Speaker 2: you could say there are other opportunities in front of 275 00:13:51,440 --> 00:13:54,199 Speaker 2: us with the empowering and how Nui and our other sites, 276 00:13:54,600 --> 00:13:58,000 Speaker 2: but there are also risks with those. Nothing is certain 277 00:13:58,160 --> 00:14:01,240 Speaker 2: about the future. We haven't got to a final investment 278 00:14:01,280 --> 00:14:05,800 Speaker 2: decision yet for Drury, how and that requires us to 279 00:14:06,000 --> 00:14:09,319 Speaker 2: look at all the logistics of the repowering, the civil engineering, 280 00:14:09,320 --> 00:14:12,800 Speaker 2: the electrical engineering, the new turbines taking down the old turbines. 281 00:14:13,120 --> 00:14:15,880 Speaker 2: There's lots of things to happen, right, and there's always 282 00:14:16,200 --> 00:14:20,040 Speaker 2: always risks for that outlook. So on balance, if the 283 00:14:20,200 --> 00:14:23,520 Speaker 2: independent value agrees with us, then we think twenty five 284 00:14:23,640 --> 00:14:27,000 Speaker 2: cents is a great outcome for our current shareholders and 285 00:14:27,160 --> 00:14:29,880 Speaker 2: is unanimously supported by the Board of directors. 286 00:14:30,560 --> 00:14:33,440 Speaker 3: And there's no white knights in the wings? Are there? 287 00:14:34,560 --> 00:14:36,920 Speaker 2: If there are, the wings haven't flown to me, So 288 00:14:36,960 --> 00:14:37,840 Speaker 2: I don't know. 289 00:14:40,160 --> 00:14:42,440 Speaker 3: So Craig from New Zealand wind Farms says there are 290 00:14:42,440 --> 00:14:46,160 Speaker 3: no white knights in the wings. Why is Meridian so keen? 291 00:14:46,960 --> 00:14:51,360 Speaker 3: According to Meridian CEO Neil Barclay, it's a pretty spectacular sight. 292 00:14:52,040 --> 00:14:55,080 Speaker 3: Plus for him, there's pressure to make this deal happen 293 00:14:55,360 --> 00:14:58,720 Speaker 3: sooner than later. I sat down with Neil Barclay to 294 00:14:58,760 --> 00:15:02,760 Speaker 3: give investors the Meridian perspective. Neil, welcome to the studio. 295 00:15:03,040 --> 00:15:05,440 Speaker 3: Thanks hell you are leaving Meridian. I think at the 296 00:15:05,520 --> 00:15:08,400 Speaker 3: end of June, when we think about this New Zealand 297 00:15:08,440 --> 00:15:11,240 Speaker 3: Wind Farms scheme, if you like the in vestas are 298 00:15:11,240 --> 00:15:13,640 Speaker 3: going to be looking at. Is this something you wanted 299 00:15:13,640 --> 00:15:15,160 Speaker 3: to get across the line before you leave. 300 00:15:16,680 --> 00:15:19,800 Speaker 1: Yeah, it is. Look, when you take on a CEO 301 00:15:19,920 --> 00:15:21,680 Speaker 1: roll like mine, you don't. You don't do it to 302 00:15:21,760 --> 00:15:23,960 Speaker 1: create some sort of legacy. You do it to sort 303 00:15:24,000 --> 00:15:26,920 Speaker 1: of work with teams and do some good things. But 304 00:15:27,080 --> 00:15:29,680 Speaker 1: of late I have started to look back and think 305 00:15:29,720 --> 00:15:32,600 Speaker 1: about the legacy that I might be leaving behind. And 306 00:15:32,600 --> 00:15:35,200 Speaker 1: there's some things I'm super proud of. I think the 307 00:15:35,240 --> 00:15:40,560 Speaker 1: way we've developed our retail proposition and Meridian is our standing. 308 00:15:40,600 --> 00:15:43,440 Speaker 1: We've grown our market share. We're almost double the size 309 00:15:43,440 --> 00:15:46,320 Speaker 1: of the retail business in the last five six years. 310 00:15:47,400 --> 00:15:50,120 Speaker 1: And in my time in the business, we've also built 311 00:15:50,160 --> 00:15:53,760 Speaker 1: about six wind farms in New Zealand, couple in Australia, 312 00:15:54,400 --> 00:15:57,400 Speaker 1: and with Teriri Ho we would have we would have 313 00:15:57,440 --> 00:16:01,280 Speaker 1: produced enough new renewable energy to power about half a 314 00:16:01,280 --> 00:16:04,320 Speaker 1: million homes and I think that's something that I'm very 315 00:16:04,320 --> 00:16:05,320 Speaker 1: proud to leave behind. 316 00:16:05,640 --> 00:16:08,280 Speaker 3: To very hope is the wind farm near Palmerston North, 317 00:16:08,280 --> 00:16:10,120 Speaker 3: which is really the crown and the jewel for New 318 00:16:10,240 --> 00:16:14,160 Speaker 3: Zealand wind farms. If that the steel goes through, what 319 00:16:14,200 --> 00:16:16,760 Speaker 3: does that do for what Meridian has I think you've 320 00:16:16,800 --> 00:16:19,080 Speaker 3: got about is it eight wind farms. 321 00:16:19,160 --> 00:16:21,640 Speaker 1: We've got six operating wind farms in New Zealand at 322 00:16:21,640 --> 00:16:24,360 Speaker 1: the moment. This would be our seventh, but it's also 323 00:16:24,400 --> 00:16:27,880 Speaker 1: our largest, so it would increase the portfolio of wind 324 00:16:27,960 --> 00:16:32,880 Speaker 1: assets by about thirty five percent. That's significant. New Zealand's 325 00:16:33,000 --> 00:16:36,920 Speaker 1: Meridians largely are our hydro generator. Most of our generation 326 00:16:37,000 --> 00:16:40,160 Speaker 1: assets are in the South Island, but this would bring 327 00:16:40,200 --> 00:16:42,440 Speaker 1: our wind portfolio up to about twenty percent of our 328 00:16:42,440 --> 00:16:46,480 Speaker 1: total generation. That's becoming quite meaningful. 329 00:16:45,760 --> 00:16:48,520 Speaker 3: Is their plans to extend that even further. I mean, 330 00:16:48,560 --> 00:16:49,000 Speaker 3: what's there. 331 00:16:49,280 --> 00:16:53,840 Speaker 1: Yeah, absolutely, Look, we've got huge amount of renewable resources 332 00:16:53,840 --> 00:16:56,840 Speaker 1: in this country and that's that's our future, that's our opportunity. 333 00:16:57,680 --> 00:17:01,800 Speaker 1: So we've been working on build portfolio of options that 334 00:17:01,840 --> 00:17:04,159 Speaker 1: we can develop, both wind, solar. We've even got a 335 00:17:04,160 --> 00:17:07,360 Speaker 1: battery being built in North End right now. We expect 336 00:17:07,359 --> 00:17:09,640 Speaker 1: to sign off on about a billion dollars of investment 337 00:17:09,720 --> 00:17:13,159 Speaker 1: this this calendar year, which would include ter Aria and 338 00:17:13,240 --> 00:17:15,800 Speaker 1: about three billion dollars by the end of this decade 339 00:17:16,240 --> 00:17:18,800 Speaker 1: and about ten billion dollars by twenty fifty. Is part 340 00:17:18,800 --> 00:17:22,600 Speaker 1: of our efforts to help decarbonize the New Zealand economy. 341 00:17:22,880 --> 00:17:25,720 Speaker 3: Where does Soula fit with that? What's the ideal sort 342 00:17:25,760 --> 00:17:28,520 Speaker 3: of percentage break down for those three types of energy? 343 00:17:28,760 --> 00:17:32,560 Speaker 1: Well, I think hydro will remain the mainstay of the 344 00:17:32,560 --> 00:17:35,159 Speaker 1: New Zealand electricity system. We're so lucky to have it. 345 00:17:35,160 --> 00:17:37,600 Speaker 1: It's so flexible, it's it's you know, it's. 346 00:17:37,480 --> 00:17:42,399 Speaker 3: The lately lags being down the lakes. 347 00:17:42,160 --> 00:17:44,400 Speaker 1: Can move around a wee bit. But what we what 348 00:17:44,440 --> 00:17:47,280 Speaker 1: we know is as we build out more wind, solar 349 00:17:47,359 --> 00:17:49,800 Speaker 1: and the geo thermal that's been built is very helpful 350 00:17:49,840 --> 00:17:53,879 Speaker 1: as well. The risk of hydro shortfall actually reduces because 351 00:17:53,880 --> 00:17:57,560 Speaker 1: we've got a more diversified generation fleet around the whole country. 352 00:17:58,160 --> 00:18:01,359 Speaker 1: So that's really our future now. Solar has a strong 353 00:18:01,400 --> 00:18:04,520 Speaker 1: part to play. What we've been finding of late, interestingly 354 00:18:04,640 --> 00:18:08,160 Speaker 1: but not too surprisingly, is when we have those high, 355 00:18:09,160 --> 00:18:11,760 Speaker 1: very calm weather systems that don't bring the rain, they 356 00:18:11,760 --> 00:18:16,040 Speaker 1: also don't bring the wind. Alternatively, solar is a really 357 00:18:16,040 --> 00:18:19,080 Speaker 1: strong generation option at times like that. So we think 358 00:18:19,160 --> 00:18:22,359 Speaker 1: solar complements wind, hydro and the GFM or we have 359 00:18:22,440 --> 00:18:25,000 Speaker 1: in the system today and will ultimately get us to 360 00:18:25,040 --> 00:18:27,199 Speaker 1: one hundred percent renewable electricity. 361 00:18:27,080 --> 00:18:30,679 Speaker 3: Because how often would you need to rely on, say, thermal, 362 00:18:30,720 --> 00:18:32,639 Speaker 3: which is sort of coal and gas, well it was 363 00:18:32,680 --> 00:18:33,960 Speaker 3: gas for a while anyway. 364 00:18:35,160 --> 00:18:38,199 Speaker 1: The amount of thermal generation in the New Zealand system 365 00:18:38,240 --> 00:18:43,280 Speaker 1: has reduced from about well about thirty five percent of 366 00:18:43,280 --> 00:18:47,560 Speaker 1: the total system needs fifteen years ago to about twelve 367 00:18:47,560 --> 00:18:51,119 Speaker 1: percent today. So that's going down all the time. And 368 00:18:51,160 --> 00:18:54,480 Speaker 1: we will burn less and less thermal fuel as we progress, 369 00:18:55,280 --> 00:18:59,880 Speaker 1: as we build more wind, solar and decarbonize. But when 370 00:19:00,040 --> 00:19:02,600 Speaker 1: we do need it, we really need it, yeah, and 371 00:19:02,640 --> 00:19:06,199 Speaker 1: that's like last winter and like this coming winter. And 372 00:19:06,240 --> 00:19:08,960 Speaker 1: we've got a problem in this country because investments slowed 373 00:19:08,960 --> 00:19:12,919 Speaker 1: down in the gas and domestic gas. And that's unfortunate 374 00:19:12,960 --> 00:19:16,439 Speaker 1: because domestic gas it was a lot more is a 375 00:19:16,440 --> 00:19:20,000 Speaker 1: lot less carbon intensive than burning coal. But what what's 376 00:19:20,080 --> 00:19:22,280 Speaker 1: occurred is the investment hasn't gone in. We've got a 377 00:19:22,280 --> 00:19:24,200 Speaker 1: short full of gas, so we're actually having to burn 378 00:19:24,240 --> 00:19:28,280 Speaker 1: more coal in times where we have low hydrome flows. 379 00:19:29,200 --> 00:19:31,560 Speaker 1: We will manage through that. It's probably a two to 380 00:19:31,560 --> 00:19:34,439 Speaker 1: three year sort of inch point, we're calling it. But 381 00:19:34,520 --> 00:19:37,880 Speaker 1: as the new renewables, including projects like terrariy Hoe, come 382 00:19:37,920 --> 00:19:43,879 Speaker 1: on stream, we'll start burning less coal again and just transition. 383 00:19:44,840 --> 00:19:47,240 Speaker 1: It's inevitable we transition to close to one hundred percent 384 00:19:47,640 --> 00:19:50,840 Speaker 1: electricity grit and that's going to happen probably overin the 385 00:19:50,920 --> 00:19:52,200 Speaker 1: next fifteen years, next. 386 00:19:52,080 --> 00:19:55,359 Speaker 3: Fifteen years, right, Yeah, because this last winter was tough, 387 00:19:55,480 --> 00:19:59,240 Speaker 3: and even your interim results just recently that really showed 388 00:19:59,240 --> 00:20:01,440 Speaker 3: that you had so hedging that you had to do 389 00:20:01,840 --> 00:20:04,359 Speaker 3: because you didn't have that gas coming on stream, and 390 00:20:04,400 --> 00:20:06,240 Speaker 3: you had to pay for that because you had a 391 00:20:06,240 --> 00:20:08,520 Speaker 3: loss I think was one twenty one million net loss. 392 00:20:08,800 --> 00:20:10,760 Speaker 3: Com me to say, you know, a profit of one 393 00:20:10,840 --> 00:20:15,800 Speaker 3: hundred and ninety one million the year before, quite a 394 00:20:15,800 --> 00:20:19,360 Speaker 3: big difference. Are you confident that, say investors looking at 395 00:20:19,400 --> 00:20:22,520 Speaker 3: this now from the New Zealand wind farmer's perspective, that 396 00:20:22,600 --> 00:20:25,600 Speaker 3: you can kind of mitigate that and not have quite 397 00:20:25,600 --> 00:20:27,400 Speaker 3: the same thing happen or Yeah. 398 00:20:27,240 --> 00:20:32,240 Speaker 1: Look, Meridian, we're a renewables only energy company. We rely 399 00:20:32,320 --> 00:20:34,640 Speaker 1: on Mother Nature. So when it doesn't rain, we don't 400 00:20:34,680 --> 00:20:38,160 Speaker 1: have the fuel to generate to meet our customer commitment, 401 00:20:38,240 --> 00:20:40,439 Speaker 1: so we have to buy generation from someone else, and 402 00:20:40,480 --> 00:20:42,879 Speaker 1: so we plan for the type of event that happened 403 00:20:42,920 --> 00:20:47,960 Speaker 1: last year. We carry a balance sheet is very very 404 00:20:48,200 --> 00:20:51,040 Speaker 1: if you caught unleathered lun leavered, it's very flexible. There's 405 00:20:51,040 --> 00:20:53,240 Speaker 1: a lot of capacity in the balance sheet to be 406 00:20:53,280 --> 00:20:55,800 Speaker 1: able to cope with a poor financial year. On the 407 00:20:55,840 --> 00:21:00,320 Speaker 1: back of a really extreme weather situation that our you know, 408 00:21:00,359 --> 00:21:04,200 Speaker 1: it was the driest period between April and August, sorry 409 00:21:04,280 --> 00:21:06,680 Speaker 1: May and August twenty twenty four that we've ever seen. 410 00:21:06,680 --> 00:21:08,919 Speaker 1: We've actually just gone into another dry It's been the 411 00:21:09,000 --> 00:21:13,920 Speaker 1: driest period between December in mid March that we've ever seen. 412 00:21:14,600 --> 00:21:16,880 Speaker 1: But we're still in reasonably good shape for the winter 413 00:21:16,960 --> 00:21:18,879 Speaker 1: and it's starting to rain now, which is helpful. But 414 00:21:19,000 --> 00:21:21,840 Speaker 1: we've had a couple of really extreme where the systems. 415 00:21:21,880 --> 00:21:24,760 Speaker 1: That's what we set our business up to cope with, 416 00:21:26,119 --> 00:21:28,719 Speaker 1: and it doesn't put too much pressure on the business 417 00:21:28,720 --> 00:21:30,560 Speaker 1: at all. We expect to get back to something more 418 00:21:30,600 --> 00:21:33,600 Speaker 1: like normal going forward, and it wouldn't slow down our 419 00:21:33,600 --> 00:21:36,520 Speaker 1: commitment to building new and your wal projects, and certainly 420 00:21:36,520 --> 00:21:38,760 Speaker 1: wouldn't slow down a commitment to building Teleio. 421 00:21:40,000 --> 00:21:43,600 Speaker 3: Looking at Derera, how then it was a development project. 422 00:21:43,720 --> 00:21:45,760 Speaker 3: What has been what still is at the minute, a 423 00:21:45,760 --> 00:21:48,119 Speaker 3: fifty to fifty joint menture between you and New Zealand 424 00:21:48,160 --> 00:21:52,080 Speaker 3: Wind Farms. You now want to buy the entire company 425 00:21:52,080 --> 00:21:55,040 Speaker 3: and you have a twenty percent stake called Ready. When 426 00:21:55,160 --> 00:21:57,200 Speaker 3: was it that you thought, oh, what's the point of 427 00:21:57,280 --> 00:21:59,600 Speaker 3: us keeping going like this? Why don't we just take 428 00:21:59,640 --> 00:22:00,240 Speaker 3: the whole going. 429 00:22:00,200 --> 00:22:03,560 Speaker 1: On a few months back, as we were moving through 430 00:22:03,560 --> 00:22:07,320 Speaker 1: the project and as the JV partnership went to the 431 00:22:07,359 --> 00:22:11,840 Speaker 1: market to assess what the level of debt the JV 432 00:22:11,920 --> 00:22:14,280 Speaker 1: would have to incur would be, and the cost of 433 00:22:14,320 --> 00:22:18,520 Speaker 1: that debt, became pretty apparent that given Meridians flexible balance 434 00:22:18,560 --> 00:22:21,280 Speaker 1: sheet that we just referred to, we could borrow the 435 00:22:21,320 --> 00:22:24,680 Speaker 1: money a lot more cheaply than the JV could. And 436 00:22:24,720 --> 00:22:29,000 Speaker 1: that was the value equation That meant that us taking 437 00:22:29,359 --> 00:22:32,320 Speaker 1: a much larger stake in New Zealand wind Farms would 438 00:22:32,359 --> 00:22:35,640 Speaker 1: make sense for New Zealand Wind Farms shareholders and ultimately 439 00:22:35,640 --> 00:22:38,920 Speaker 1: from Meridian shareholders as well. It's a more efficient way 440 00:22:39,320 --> 00:22:42,000 Speaker 1: to finance the project to make sure it gets delivered 441 00:22:42,240 --> 00:22:43,320 Speaker 1: as quickly as we can. 442 00:22:43,560 --> 00:22:46,040 Speaker 3: And you obviously did a bit more due diligence before 443 00:22:46,080 --> 00:22:48,560 Speaker 3: you made that call, and you were pretty happy obviously 444 00:22:48,640 --> 00:22:49,400 Speaker 3: with what you saw. 445 00:22:50,160 --> 00:22:53,359 Speaker 1: Yeah. Absolutely, we think it's the best wind sight in 446 00:22:53,400 --> 00:22:56,360 Speaker 1: the country. Why is that it's just the wind conditions 447 00:22:56,400 --> 00:22:58,840 Speaker 1: that perfect it, or have about a fifty percent more 448 00:22:58,880 --> 00:23:02,159 Speaker 1: than fifty percent capacity factor, So that means if you 449 00:23:02,200 --> 00:23:04,680 Speaker 1: build it to produce a certain amount of energy, you'll 450 00:23:04,720 --> 00:23:07,680 Speaker 1: get at least fifty percent out of that. Now compare 451 00:23:07,680 --> 00:23:10,320 Speaker 1: that to say what they get in Australia late twenties, 452 00:23:11,040 --> 00:23:13,359 Speaker 1: most other wind farms in New Zealand thirty five to 453 00:23:13,400 --> 00:23:16,359 Speaker 1: forty forty five. Maybe this is fifty percent plus. So's 454 00:23:16,680 --> 00:23:21,159 Speaker 1: it's an exceptional wind site, very windy place as anyone 455 00:23:21,160 --> 00:23:23,000 Speaker 1: from Palming North, Not that I. 456 00:23:22,960 --> 00:23:25,080 Speaker 3: Do, but I've been past it and it's always going 457 00:23:25,119 --> 00:23:25,680 Speaker 3: that's for sure. 458 00:23:25,880 --> 00:23:26,120 Speaker 2: Yeah. 459 00:23:26,160 --> 00:23:29,920 Speaker 1: So it's a great site because of the existing wind 460 00:23:29,960 --> 00:23:33,360 Speaker 1: farm there. We can leverage some of the roading and 461 00:23:33,400 --> 00:23:36,640 Speaker 1: so forth that's already in existence, so there are some 462 00:23:36,680 --> 00:23:42,120 Speaker 1: cost savings available. We're not at the point of commitment though, 463 00:23:42,240 --> 00:23:46,240 Speaker 1: so there's still work to be done. There's still risks involved, 464 00:23:46,520 --> 00:23:49,120 Speaker 1: and you never know for sure exactly what when you're 465 00:23:49,119 --> 00:23:51,840 Speaker 1: going to get out of it until because until you've 466 00:23:51,880 --> 00:23:56,399 Speaker 1: stand stood up the thirty nine turbines that will hopefully 467 00:23:56,480 --> 00:23:58,560 Speaker 1: go into play in this particular wind farm. 468 00:23:58,800 --> 00:24:01,960 Speaker 3: Yeah, so we're talking thirty nine in a couple of stages. 469 00:24:02,000 --> 00:24:03,120 Speaker 3: I think that is, isn't it. 470 00:24:03,480 --> 00:24:08,320 Speaker 1: No, No, that'll be built. Sorry, it's two separate parts 471 00:24:08,359 --> 00:24:10,359 Speaker 1: of the property, but it will be developed as one. 472 00:24:10,240 --> 00:24:13,399 Speaker 3: Project, one project okay, and I mean the cost is 473 00:24:13,440 --> 00:24:16,080 Speaker 3: still significant though I've seen figures of five hundred to 474 00:24:16,119 --> 00:24:17,280 Speaker 3: six hundred million as well. 475 00:24:17,400 --> 00:24:20,280 Speaker 1: It'll be north of six million. So it's a huge 476 00:24:20,560 --> 00:24:25,080 Speaker 1: project begun to take in. But it's you know, this 477 00:24:25,160 --> 00:24:27,320 Speaker 1: is what we do. And we've built six of these 478 00:24:27,400 --> 00:24:31,680 Speaker 1: so far, plus a couple in Australia. We know what, 479 00:24:32,000 --> 00:24:34,600 Speaker 1: we know how to do it. We've got the experienced 480 00:24:34,600 --> 00:24:36,840 Speaker 1: team and they will get it done. But there's still 481 00:24:36,880 --> 00:24:39,560 Speaker 1: some challenges in front of us. And to give you 482 00:24:39,560 --> 00:24:43,200 Speaker 1: an example, just two days ago, within the wind farm, 483 00:24:43,320 --> 00:24:46,639 Speaker 1: the existing wind farm its south there's an airways facility 484 00:24:46,640 --> 00:24:49,560 Speaker 1: that communicates with planes flying over and around the region, 485 00:24:49,960 --> 00:24:53,280 Speaker 1: really important piece of kit. We had agreed with the 486 00:24:53,280 --> 00:24:58,040 Speaker 1: airways to reposition that that facility to a different high 487 00:24:58,119 --> 00:25:01,760 Speaker 1: point in the region away from the wind farm. Turns 488 00:25:01,760 --> 00:25:05,640 Speaker 1: out that that new spot won't work. They can't get 489 00:25:05,680 --> 00:25:07,560 Speaker 1: the radio signals that they need, so we need to 490 00:25:07,600 --> 00:25:10,560 Speaker 1: find another place. Now there are other options, but it 491 00:25:10,680 --> 00:25:13,080 Speaker 1: means that we're likely to delay the project by another 492 00:25:13,160 --> 00:25:15,240 Speaker 1: month or two as we work that through. These are 493 00:25:15,320 --> 00:25:19,960 Speaker 1: the sorts of things that you work through as a 494 00:25:19,960 --> 00:25:24,000 Speaker 1: wind farmer. It's often two steps forward one step back, 495 00:25:24,160 --> 00:25:27,720 Speaker 1: maybe a couple of sideways, but I think what we 496 00:25:27,800 --> 00:25:30,439 Speaker 1: have shown at Meridian we have the capability and the 497 00:25:30,480 --> 00:25:33,119 Speaker 1: experience to get it done, and we will get it done. 498 00:25:33,359 --> 00:25:36,359 Speaker 3: Are we first class in the world then for wind farming? 499 00:25:36,600 --> 00:25:40,960 Speaker 1: Yeah? Absolutely. The onshore wind resource in New Zealand is 500 00:25:41,000 --> 00:25:44,200 Speaker 1: the best in the world. When I first joined Meridian, 501 00:25:44,440 --> 00:25:46,160 Speaker 1: I went off to see one of our main supply 502 00:25:46,320 --> 00:25:49,320 Speaker 1: seemens in Denmark and they had the wind farm out 503 00:25:49,359 --> 00:25:52,560 Speaker 1: here in Wellington at marcra will call it west Wind 504 00:25:52,640 --> 00:25:55,800 Speaker 1: plastered all over their buildings because it was the best 505 00:25:55,800 --> 00:25:59,240 Speaker 1: performing wind farm that they had built anywhere in the world. 506 00:26:00,080 --> 00:26:03,239 Speaker 1: Terrary whole will be an even stronger performing asset than 507 00:26:03,240 --> 00:26:03,919 Speaker 1: that one. 508 00:26:03,760 --> 00:26:06,240 Speaker 3: Because with climate change we're supposed to get windier. So 509 00:26:06,359 --> 00:26:08,560 Speaker 3: is it even is it even more potential? 510 00:26:09,240 --> 00:26:13,320 Speaker 1: Yeah? In New Zealand there is absolutely. It's interesting with 511 00:26:13,359 --> 00:26:17,040 Speaker 1: climate change we're likely to get more rain into where 512 00:26:17,040 --> 00:26:20,439 Speaker 1: the hydro catchments are in this country and more wind 513 00:26:20,920 --> 00:26:23,840 Speaker 1: into those areas that we're building wind farms, so it 514 00:26:23,880 --> 00:26:28,240 Speaker 1: should improve the overall generation capability. Out of the assets 515 00:26:28,240 --> 00:26:30,920 Speaker 1: that are that are being deployed, have been deployed and 516 00:26:30,960 --> 00:26:31,720 Speaker 1: will be deployed. 517 00:26:32,160 --> 00:26:34,600 Speaker 3: You said before, there's a few hurdles to go. You've got, 518 00:26:35,080 --> 00:26:36,840 Speaker 3: you know, a few things you need to sort out. 519 00:26:37,320 --> 00:26:42,320 Speaker 3: There's a shareholder vote, there's a High Court commist commission. 520 00:26:42,320 --> 00:26:44,720 Speaker 3: I think there's a number of regulatory things as well. 521 00:26:45,000 --> 00:26:47,840 Speaker 3: How confident are you that this will will go through? 522 00:26:48,280 --> 00:26:50,280 Speaker 1: Well, we think the offer that we're put on the 523 00:26:50,320 --> 00:26:54,040 Speaker 1: table is outstanding value for New Zealand ship wind Farm shareholders. 524 00:26:55,320 --> 00:26:58,679 Speaker 1: You're getting a good return on the asset and taking 525 00:26:58,720 --> 00:27:00,800 Speaker 1: no risk from this point on, and there's still quite 526 00:27:00,840 --> 00:27:02,840 Speaker 1: a lot of risk and work to be done. So 527 00:27:02,880 --> 00:27:05,200 Speaker 1: we think it's a really good a really good option. 528 00:27:05,440 --> 00:27:08,080 Speaker 1: We think it's a fair deal and it's a fear 529 00:27:08,119 --> 00:27:11,240 Speaker 1: for the Meridian shareholders as well. So we think it's 530 00:27:11,240 --> 00:27:14,680 Speaker 1: a great example of working together with a board that 531 00:27:15,560 --> 00:27:18,520 Speaker 1: have actually put their asset on us. You know, we've 532 00:27:18,840 --> 00:27:21,640 Speaker 1: had to front with our very best foot sorry, put 533 00:27:21,640 --> 00:27:25,480 Speaker 1: our very best foot forward. But we think it'll work 534 00:27:25,480 --> 00:27:29,399 Speaker 1: through the process and subject to shareholder approval, it'll be 535 00:27:29,400 --> 00:27:30,840 Speaker 1: a great outcome for all concerned. 536 00:27:31,680 --> 00:27:35,840 Speaker 3: We've got quite a big contingent of shareholders on cheesies, 537 00:27:35,920 --> 00:27:38,560 Speaker 3: I think twenty twelve percent, which is quite something for 538 00:27:38,640 --> 00:27:41,760 Speaker 3: a retailed block. Do you ever hear from them or 539 00:27:41,800 --> 00:27:44,640 Speaker 3: do you sort of know much about what they might 540 00:27:44,680 --> 00:27:46,720 Speaker 3: be thinking since this was announced. 541 00:27:46,800 --> 00:27:50,040 Speaker 1: I think we No, I haven't heard directly other than 542 00:27:50,080 --> 00:27:54,080 Speaker 1: through the New Zealand Wind Farms board members. They're communicating 543 00:27:54,119 --> 00:27:57,280 Speaker 1: directly with their shareholders. It's not for us other than 544 00:27:57,359 --> 00:28:03,920 Speaker 1: the sort of sort of pitch, But from aridiance perspective, 545 00:28:04,000 --> 00:28:07,560 Speaker 1: we're learning more and getting more engaged for shares these shareholders, 546 00:28:07,600 --> 00:28:09,879 Speaker 1: for sure. And I think our CFO Mike Grohn is 547 00:28:10,200 --> 00:28:13,280 Speaker 1: who's who's the next CEO? By the way, He's been 548 00:28:13,320 --> 00:28:17,000 Speaker 1: on a couple of sort of similar podcasts as are, 549 00:28:17,119 --> 00:28:21,240 Speaker 1: So yeah, it's it's it's certainly an area of growth. 550 00:28:21,760 --> 00:28:25,840 Speaker 1: It's a great opportunity for Kiwis to take ownership of 551 00:28:25,960 --> 00:28:29,360 Speaker 1: some outstanding assets in our country. I use it myself 552 00:28:29,560 --> 00:28:34,040 Speaker 1: for my share portfolio. So yeah, No, we're happy and 553 00:28:34,440 --> 00:28:37,400 Speaker 1: more than willing to engage with share shares these shareholders 554 00:28:37,880 --> 00:28:40,960 Speaker 1: as much as yeah, of use to them. 555 00:28:41,840 --> 00:28:44,240 Speaker 3: I won't ask you for tips then on cheer training 556 00:28:44,960 --> 00:28:45,440 Speaker 3: this time. 557 00:28:46,680 --> 00:28:48,800 Speaker 1: No, I wouldn't at the moment either, because the share 558 00:28:48,880 --> 00:28:52,440 Speaker 1: market is in Yeah, it's it's blood on the floor 559 00:28:52,480 --> 00:28:56,640 Speaker 1: all over the place, but it's due to international matters 560 00:28:56,680 --> 00:29:00,200 Speaker 1: that are outside of we folk in New Zealand just 561 00:29:00,200 --> 00:29:02,800 Speaker 1: going to ride through that for the time. 562 00:29:03,680 --> 00:29:06,720 Speaker 3: When you think about those New Zealand Wind Farms shareholders, 563 00:29:06,800 --> 00:29:10,640 Speaker 3: I mean they are potentially going to be shareholders in Meridian. 564 00:29:11,320 --> 00:29:14,040 Speaker 3: It's quite a different company to what they signed up for. 565 00:29:14,120 --> 00:29:17,320 Speaker 3: It's a gen Taylor. It's got, as you said before, 566 00:29:17,320 --> 00:29:20,440 Speaker 3: a number of challenges and opportunities. What would you say 567 00:29:20,520 --> 00:29:21,240 Speaker 3: to them? 568 00:29:21,640 --> 00:29:27,560 Speaker 1: Our growth prospects are fantastic renewable energies the future. It's 569 00:29:27,640 --> 00:29:32,360 Speaker 1: the competitive advantage for New Zealand. So it's certainly a 570 00:29:32,400 --> 00:29:35,120 Speaker 1: place that I have a lot of personal holdings in 571 00:29:35,160 --> 00:29:37,640 Speaker 1: the company and I'll keep that even when I've moved 572 00:29:37,680 --> 00:29:39,800 Speaker 1: on from being chief executive. 573 00:29:40,480 --> 00:29:43,600 Speaker 3: Thanks to Neil Barclay of Meridian and Craig Stobo of 574 00:29:43,640 --> 00:29:47,000 Speaker 3: New Zealand Wind Farms for their insights around the potential takeover. 575 00:29:47,720 --> 00:29:50,480 Speaker 3: Also look out for a bonus episode with Neil Barclay 576 00:29:50,560 --> 00:29:52,520 Speaker 3: as we find out what it's like to be a 577 00:29:52,600 --> 00:29:55,960 Speaker 3: CEO of a gent Taylor. You can watch Shared Lunch 578 00:29:56,120 --> 00:29:59,320 Speaker 3: on YouTube or follow us on your favorite podcast app. 579 00:29:59,520 --> 00:30:01,720 Speaker 3: Leave us waiting and tell us what you'd like to 580 00:30:01,760 --> 00:30:10,200 Speaker 3: hear next mm hmm,