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Z's service station sell-off progresses

NZ NewswireNZ Newswire 28/09/2016 Sophie Boot

Z Energy has signed contracts to sell 12 of the 20 sites it has to quit as part of its acquisition of Chevron New Zealand and is negotiating contracts for the rest.

The Wellington-based service station operator this month signed or was still negotiating contracts for all 20 sites, it said in a statement.

The cost of divesting the assets will be about $11 million, though $5.5 million of that is because Z decided to buy three other service stations to then divest so it could avoid having to sell "other more valuable Z or Caltex sites".

Z will disclose the net proceeds of the divestment programme once it's completed and will detail the impact on cash proceeds and future earnings at the company's October 19 investor day, it said.

The transport fuel company bought Chevron's Caltex and Challenge! brands for $785m, making it the country's biggest petrol retailer. As part of the deal, Z had to divest 19 service stations and one truck stop to get Commerce Commission approval.

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