Vector chair Michael Stiassny says he won't seek re-election at this year's annual meeting because he no longer has the support of controlling shareholder Entrust Trustees, which owns 75.1 percent of Vector and represents its electricity network customers.
Stiassny has been on the board since 2002, chairing the Auckland lines company through its merger with UnitedNetworks and its $593 million initial public offering in 2005, when it sold a 25 percent stake. He issued a statement today in response to media speculation over his tenure as chair saying he's always served with the full support of Entrust Trustees, the old Auckland Energy Consumer Trust, but doesn't have that backing anymore.
"I can confirm that I have not been asked to step down," Stiassny said. "However, it appears that I no longer have the support of the Entrust Trustees, in which case I will not seek re-election later this year."
Last month, more than 100,000 homes and businesses lost power during severe storms in Auckland, and more than 1,000 houses were still without power more than two weeks later. Electricity retailers whose customers were left without electricity are understood to be insisting on involvement in an internal process Vector is undertaking to review what is widely regarded as the Auckland network company's darkest hour since the extended black-out of 1998.
Entrust's trustees are chaired by financier and former Auckland councillor William Cairns, who is joined by Ricoh executive Michael Buczkowski, Energy Trust NZ executive James Carmichael, former MP Paul Hutchison and commercial lawyer Karen Sherry. Carmichael and Sherry are the trust's representatives on Vector's board.
The lines company is scheduled to hold its annual meeting in September.
Vector has been branching out into new lines of business in recent years to reduce its reliance on its regulated electricity and gas distribution unit, adding telecommunications, home ventilation and solar power to its suite, and investigating battery technology.
In Vector's 10-year asset management plan published this month, the company said it expects to spend $982.9 million changing its network maintenance practices to address root causes of service gaps. The $887.6 million business-as-usual scenario was rejected due to the risk of service deteriorating further.
The company lifted its projected capital sending $451 million to $2.39 billion over the decade, of which $193 million was in asset replacement and renewal "to address Vector’s aging asset population that poses significant risks to Vector’s ability to meet its service levels, health and safety requirements and environmental commitments in the next 10 years" and $190 million "to reflect the sustained growth in residential development activity exhibited in Auckland in the past few years, and expected to continue over the 10-year horizon."
Vector's report said it was uncertain about the future impact of climate change, but "recent events have shown that certain parts of our network is vulnerable to extreme weather".
Vector shares fell 0.6 percent to $3.21, having dropped 6.9 percent so far this year.