NZ's Contact Energy to raise $317 million for renewable energy projects (updated)

Contact Energy

15/02/2026 19:59

Contact Energy to raise NZ$525 for renewable energy projects

Issue at NZ$8.75 apiece

Equity raise represents 8.8% discount to last close

Updates with context, analyst comments in paras 5-9

By Shruti  Agarwal and Shivangi  Lahiri

Feb 16 (Reuters) - New Zealand's Contact Energy CEN.NZ said on Monday it will raise NZ$525 million ($317 million) in fresh equity to fund a slate of renewable energy projects, as the company accelerates growth under its long-term "Contact31+" strategy.

The fundraise includes a fully underwritten NZ$450 million institutional placement and a non-underwritten retail offer of up to NZ$75 million, Contact said in a statement.

Around 60 million new shares will be issued at NZ$8.75 apiece, an 8.8% discount to Friday's close.

The electricity generator and retailer said proceeds will allow it to begin pre-final investment decision (FID) drilling at its Tauhara 2 geothermal project and advance its Glenbrook Battery 2.0 and Glorit solar developments, key planks in a pipeline aimed at lifting renewable generation capacity over the coming decade.

Shares were placed in a trading halt pending completion of the placement.

New Zealand's power system is more than 80% renewable already and Contact broadly reflects that mix, but the company is expanding its portfolio a bit faster than some of its peers, Grant Swanepoel, equity research analyst at Jarden said.

The projects earmarked for funding were largely already factored into the company's development plans and do not materially alter its capital expenditure outlook, Swanepoel added.

The equity raise is mainly meant to give its balance sheet some breathing room, given its net debt compared with earnings is expected to approach credit rating agency caps by 2031, he added.

Contact reaffirmed its guidance to increase its total dividend to 40 NZ cents per share in fiscal 2026 and to 41–42 cents in fiscal 2027.

($1 = 1.6567 New Zealand dollars)

 (Reporting by Shivangi Lahiri and Shruti Agarwal in Bengaluru; Editing by Alexander Smith and Janane Venkatraman)

 ((Shivangi.Lahiri@thomsonreuters.com;))