New Zealand Post's proposed sale of 45 percent of Kiwbank to the New Zealand Super Fund and ACC is a very, very, smart move.
If the deal's confirmed NZ Post will receive $495 million. The money will be used to repay some of NZ Post's debt, reinvest in the parcel's business and pay a special dividend to the government.
The deal does not inject fresh capital into Kiwibank. But there is the potential for the Super Fund and ACC to put extra funds into Kiwibank so it can compete harder against the big Australian banks.
If that happens NZ Post will need to put more funds in as well. Or the Super Fund and ACC will take a larger share of the bank.
If either the Super Fund or ACC decides to sell their stake in Kiwibank they have to give the government the option of buying it back.
So all in all this looks to be the best deal possible from a less than ideal situation.