Mighty River Power has gazumped its own timetable by announcing its $50 million share buyback on Thursday.
On 2 October, the government-controlled electricity generator and retailer told fund managers attending its investor day that it planned to announce changes to its capital structure at its annual shareholders' meeting on 7 November.
Mighty River Power chair Joan Withers says the buyback's timing, coming just over a week before the Government's offer of up to 49% of the shares in Meridian Energy closes, was coincidental.
The Government sold 48% of Mighty River Power in May at $2.50 a share. The shares have consistently traded below the issue price, making the partial sale of state-owned Meridian Energy that much tougher for the Government.
Mighty River Power shares closed up 3 cents at $2.23 on Thursday.
Devon Funds Management energy analyst Phill Anderson says this isn't the first time a government-controlled power company has taken actions which just happen to enhance the value of Meridian's shares and it may not be a coincidence.
He says two weeks ago Genesis helped the Meridian process by announcing it was going to mothball one of the Huntly units earlier than expected.
Mr Anderson says the current situation is one of over-supply which makes it difficult for companies to have much pricing power.
"So by Genesis announcing that it's going to close Huntly, that tied into the market expectations for next year, so we know there's going to be less plant available to generate and that might mean that price expectations are a bit higher for next year now that the Genesis plant has gone."
At the end of June, Mighty River Power's debt was just over $120 million less than forecast in the prospectus.
Mr Anderson says the company's balance sheet was looking lazy but $50 million doesn't make much difference in the context of $1 billion in total debt.
Harbour Asset Management analyst Craig Stent says the buyback, when completed, will only add about half a cent to the value of Mighty River Power shares but the company could also increase its dividend.