Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Christchurch City to mop up remaining shares in Lyttelton

Christchurch City seeks to mop up remaining shares in Lyttelton Port

Aug. 1 (BusinessDesk) - Christchurch City Holdings, the city's infrastructure investment arm, says it will offer to buy the 20 percent of Lyttelton Port Co it doesn't already own and has a lock-up agreement for Port Otago's 15.5 percent holding. The shares soared on the news.

CCH already owns 79.6 percent of the port company and with Port Otago's holding it will comfortably be above the 90 percent threshold to compulsorily acquire the rest of the shares. It will offer $3.95 a share for remaining stock in the port company, higher than the stock has ever traded and valuing the business at about $404 million. In addition, Lyttlelton Port would also pay a special dividend of 20 cents to existing shareholders, using any imputation credits to pay the tax. The shares jumped 24 percent to $4.10 on the news

“This acquisition will enable CCH to have greater flexibility in its relationship with LPC” said Bob Lineham, the investment company's chief executive.

A formal takeover offer is likely to be made next week, the company said. On completion the port company would be delisted.

The transaction comes on the same day that the city council released a report from investment bank Cameron Partners identified a $400 million gap in Christchurch's ability to pay its share of the earthquake rebuild. That's on top of an already identified $440 million funding shortfall in a report by accounting firm Korda Mentha.

The city is contemplating the sale of a strategic stake inits investment company, which controls the city's port, airport and electricity network to help close the gap.

Mayor Lianne Dalziel argues the city would gain strategic advantage from bringing on new investors to CCH. A funding shortfall above $800 million could threaten the city's A+ credit rating from Standard & Poor's and may breach its financial obligations under local government finance legislation.

CCH owns 89.3 percent of Orion, the city's electricity network, 75 percent of Christchurch International Airport, as well as the port stake, and businesses including the Red Bus company, City Care, Enable Services and Ecocentral.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Must Sell 20 Petrol Stations: Z Cleared To Buy Caltex Assets

Z Energy is allowed to buy the Caltex and Challenge! petrol station chains but must sell 19 of its retail sites and one truck-stop, the Commerce Commission has ruled in a split decision that acknowledges possible retail price coordination between fuel retailers occurs in some regions. More>>

ALSO:

Huntly: Genesis Extends Life Of Coal-Fuelled Power Station To 2022

Genesis Energy will keep its two coal and gas-fired units at Huntly Power Station operating until 2022, having previously said they'd be closed by 2018, after wringing a high price from other electricity generators who wanted to keep them as back-up. More>>

ALSO:

Dammed If You Do: Ruataniwha Irrigation Scheme Hits Farmer Uptake Targets

Enough Hawke's Bay farmers have signed up for water from the proposed Ruataniwha Water Storage Scheme for it to go ahead as long as a cornerstone institutional capital investor can be found to back it, its regional council promoter announced. More>>

ALSO:

Reserve Bank: OCR Stays At 2.25%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2.25 percent, in a decision traders had said could go either way, while predicting inflation will pick up as the slump in oil prices washes out of the data and capacity pressures start to build in the economy. More>>

ALSO:

Export Values Down: NZ Posts Biggest Annual Trade Deficit In 7 Years

New Zealand has recorded its biggest annual trade deficit since April 2009, reflecting weaker prices of agricultural commodities such as dairy products, beef and lamb, and increased imports of vehicles and machinery. More>>

ALSO:

Currency Events: NZ's New $5 Note Wins International Banknote Award

New Zealand’s new Brighter Money $5 note has been named Banknote of the Year in a prestigious international competition. The $5 note was awarded the IBNS Banknote of the Year title at the International Bank Note Society’s annual meeting. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news