The Commerce Commission has postponed its decision on Contact Energy’s proposed $2 billion acquisition of Manawa Energy, extending the deadline until 31 March next year.
The competition regulator plans to release a statement of issues highlighting competition concerns that require further investigation. While the statement is not a final decision and does not indicate whether the merger will be approved or declined, it underscores the need for thorough scrutiny of the potential market impacts.
Both Contact and Manawa are electricity generators and wholesalers, supplying power to other retailers as well as large commercial and industrial users.
Contact also operates its own retail base, whereas Manawa focuses on a network of small hydro stations remaining after Trustpower sold its retail business to Mercury in 2022.
While Contact argues the merger would allow better management of hydro resources, especially during dry years, some smaller retailers and industrial users oppose the deal.
They contend it could lead to increased concentration in the generation sector, particularly boosting Contact’s market share.
The Commerce Commission will assess whether the merger is unlikely to substantially lessen competition before granting clearance.
