Three years after taking over Shell New Zealand's petrol refining, transport and retail operations, Infratil and the New Zealand Superannuation Fund are looking to float part of Z Energy on the NZX this year.
"While no firm decisions have been made, and any listing will depend on market conditions at the time, we have asked Z Energy to work towards a possible listing of 40 per cent to 60 per cent of the company in the third quarter," said Infratil and NZSF Aotea Ltd (for the superannuation fund).
The company's early objectives had been met, it has "strong cashflows, a good dividend outlook and growth options which would suit a wider investor audience", the pair said in a statement.
Speaking for the super fund, Matt Whineray said Z, at 2.4 per cent of the fund's total assets, was now a larger proportion of its portfolio than when it was first purchased in 2010 and "a partial listing appeals to us as a way of diversifying our investment portfolio".
Z is one of the "big two" of New Zealand transport fuel retailing, duking it out with BP New Zealand and accounting for around 30 per cent of all sales in the local market.
At its last earnings report, for the half year to September 30, Z reported a 42 per cent drop in after-tax profit to $24.9 million, reflecting intense competition in the sector and a willingness to sacrifice total sales volumes to maintain margins.
Its chief executive, Mike Bennetts has argued New Zealand needs fuel prices high enough to ensure adequate investment in its sometimes creaky distribution and storage network, and that profit margins in the business are wafer-thin.
The company has also undertaken vigorously promoted rebranding and quickly established Z as a top of mind brand for consumers, with an emphasis on the fact it is New Zealand-owned and contributing to future pensions.
Z also announced on Friday it was dropping the price of 91 octane petrol 3 cents a litre and diesel by 2 cents a litre.