NZX confirms the sale of TZ1 Registry to Markit

NZX confirms the sale of TZ1 Registry to Markit


NZX has completed the sale of the assets of the TZ1 Registry business to global financial services company Markit overnight. The deal value to NZX is US$37.1 million. At an overnight US$/NZ$ crossrate of 0.6544, this amounts to NZ$56.7 million. The initial consideration will be received up front in Markit shares, which will be held for the term of the deal through to the end of 2011. At that time the US$37.1 million figure is subject to change, with the potential to move either up or down by US$17 million, depending on the underlying performance of the TZ1 Registry business in that period.

The final gain on sale, and accounting treatment thereof, will be released as part of NZX Half Year result, which will be released pre-market on 7 August 2009.

NZX will maintain an active economic interest in the performance of the TZ1 Registry business through the next two and a half years. NZX will receive 50% of profits over that period, and also has an earn-up at the end of these two and a half years should the registry outperform its baseline targets.

NZX CEO Mark Weldon said, “NZX is proud of the TZ1 strategy, the execution, and the team, and looks forward to continued good news and strong financial return. Markit has the scale and footprint to continue to grow the business taking advantage of the opportunities as they rapidly unfold in this expanding marketplace.”

Markit is a global financial information services company, committed to the environmental markets. Markit is developing strong capability and relationships within the industry, most recently announcing the launch of a set of indices focusing on the carbon markets.

TZ1 Registry is the leading voluntary environmental registry with carbon, water, conservation banking and other biodiversity credits listed. TZ1 has the majority share of
the world!s leading Voluntary Carbon Standard (VCS) credits listed.

TZ1 Registry has more than 350 customers and over 38 million tonnes of registered voluntary emission reductions. TZ1 Registry is the number one environmental registry in the world by customer and volume share.

TZ1 Group CEO Mark Franklin, said, “NZX had great foresight to invest in the emerging carbon market. TZ1 Registry has achieved great results to date, and is recognised as the leader in environmental markets registry provision.”

TZ1 was initiated from a Carbon Market research and consultation group set up by NZX in 2006, which investigated the feasibility of carbon trading in New Zealand and surrounding commercial opportunities. NZX developed the information technology platform for the registration of carbon as an outcome of this research, and has focused on meeting the stringent criteria for industry standards and protocols that have enabled the development of trust and transparency in environmental markets.

“Moving forward, with Helen Robinson as Registry CEO, TZ1 has some exceptionally skilled New Zealand-based staff to lead the business and work with Markit to take the business to the next level. Mark Franklin has done a superb job of building a business in a highly uncertain and global environment,” said Weldon.

Mark Franklin will remain on the Markit Environmental Registry Advisory Board of which Mark Weldon will also be a member.

NZX's Half Year Result on 7 August will include NZX’s new form of statutory accounts, to reflect not only the ongoing economic interest in the TZ1 Registry business, but also the new Energy Market business (M-co) and the Rural businesses NZX has acquired.