The Government is trying a different approach to selling shares in Genesis Energy by holding the bidding by institutions at the beginning of the process.
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In the cases of Mighty River Power and Meridian, the bidding process known as a book-build was held at the end.
In Mighty River Power's case, that meant retail investors did not know the per-share price when they posted their cheques.
With Genesis, when the share offer opens in the second half of March, retail investors will know the exact price before they have to stump up with their money.
The Government is aiming to maximise the price it receives by selling fewer Genesis shares than the approximately 47 percent of Mighty River Power and 49 percent of Meridian it sold last year.
The Government says it expects to sell somewhere between 30 and 49 percent of Genesis.
However Devon Funds Management analyst Phill Anderson says the Government is going to have to sell Genesis shares at a deep discount and therefore much higher yield than the other electricity retailers and generators.
He says Genesis has fewer long-term assets than Mighty River and Meridian, in that it has the Kupe gas field and the Huntly coal fired power station as flagship assets.
Mr Anderson says to compensate for that the company will have to have a significantly higher yield than the rest of the sector, perhaps something in the 9 to 10 percent cash yield range would look attractive to investors.
With the prospect of something like that coming to market it will be a headwind to other stocks in the sector, he says.
Genesis rains on Mighty River's parade
The Genesis Energy float details put a dampener on Mighty River Power's share price, despite the market viewing its results as positive.
Mighty River Power shares rose as high as $2.07.5 but ended the day at $2.02, down 2 cents. That's well down from the $2.50 issue price in last May's float.
The electricity generator and retailer lifted net profit 64 percent to $123.7 million for the six months to December from $75.5 million in the same period a year earlier.
The power company, which is about 53 percent owned by the Government, says the increase was despite its worst-ever hydro conditions.
Mighty River reaffirmed that it expects to meet its full-year prospectus forecast for operating profit and, as forecast at last November's annual shareholders' meeting, net profit should be more than $35 million ahead of the prospectus prediction.
