New Zealand's largest fuel company appears to be headed into Australian ownership as Z Energy's board of directors recommended its shareholders accept a marginally improved $2 billion offer from Ampol.

Structured as a scheme of the arrangement, the deal values Z Energy at around $2 billion, well down from the company's peak in 2016 when shares in Wellington-headquartered Z Energy traded at more than $8.50.

New Zealand Herald Business Editor Hamish Rutherford tell Nick Mills what this particular means for the Capital.