Z Energy shareholders, Infratil Limited and NZSF Aotea Limited (on behalf of the New Zealand Superannuation Fund) announced last week that their joint owned company Z Energy Holdings Limited conditionally agreed to sell 60% of Z Energy in its Initial Public Offer (IPO), realising gross proceeds of NZ$840m (NZ$420m each).

The Final Price per Offer Share was finally set at $3.50, in the middle of the indicative price range of $3.25 - $3.75. Infratil Limited's and NZSF Aotea Limited's retained shareholding in Z Energy will be 40%.

Today, shares commenced trading on the NZX Main Board. The stock traded as high as 3.74 New Zealand dollars (US$3.03), or 6.9% above its NZ$3.50 offer price. More than 42 million shares changed hands during the first day of trading, which saw the stock close at NZ$3.66.

Infratil CEO Marko Bogoievski said the market's response to the IPO was very strong across the board.

"We received a strong response from the retail broker network, with their allocations requiring significant scaling. We have also been delighted with the positive response from institutional investors, which we see as a validation of the New Zealand economy, the transport fuels industry, and the achievements of Z under our ownership. "

Mr Whineray, New Zealand Superannuation Fund spokesperson, said the Fund would be reinvesting the proceeds of the sale in other investment opportunities in New Zealand and internationally.

Z will be New Zealand's first listed transport fuels distribution company and is expected to be among the largest 20 New Zealand companies on the NZX main board.

Z Energy was purchased by Infratil and the New Zealand Superannuation Fund from global energy company Shell in 2010, with each party taking a 50% share.

As outlined in the combined investment statement and prospectus dated 25 July 2013, the remaining shares held by Infratil and the NZSF Aotea Limited will be subject to transfer restrictions until after the release of Z's results for the half year to 30 September 2014.

First NZ Capital, Goldman Sachs, Deutsche Bank/Craigs and Forsyth Barr acted as Joint Lead Managers in the offer.

Source: Infratil & InfraPPP's research