Labour warns against rushed SOE sale

The government is considering partially selling all three of its state-owned power companies next year and Labour is warning that if it goes ahead the market will be flooded.

The High Court earlier this month dismissed a bid by the Maori Council to delay the Mighty River Power share float.

An appeal is going to be heard by the Supreme Court in February and the government is confident it will win that as well.

The sale of 49 per cent of the shares in Mighty River Power is scheduled for the first half of next year with Genesis Energy and Meridian Energy following.

"We'll certainly do two in 2013, the question is whether we do three. Some people have suggested it," Finance Minister Bill English told Fairfax.

Labour's state-owned enterprises spokesman Clayton Cosgrove says that would be economic idiocy.

"Selling all three next year will flood the market and depress demand, which will lead to low share prices and a bad deal for taxpayers," he said on Thursday.

"There simply isn't the demand for three energy companies in the share market - low demand means low share prices which means the companies are sold off for a pittance."

Mr Cosgrove says investors are already wary of buying into the companies because there will be so many shares on offer in the same industry.

The government is going to partially sell state-owned coal miner Solid Energy as well as the three hydro power stations and expects to get about $6 billion in total.

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