News Article
NEWS ARTICLE
Ports of Auckland's planned acquisition of Port of Tauranga's container terminal is now off
Posted on 26th February 2009
We are not surprised with Ports of Auckland's announcement earlier this morning that they will no longer be pursuing their proposed acquisition of Port of Tauranga's container business, previously conveyed in August 2008.Earlier in the month, we held an informal meeting (at Ports of Auckland's request) where they presented an incomplete proposal to merge our respective container terminal businesses. This was considered by the Port of Tauranga Board on Tuesday and was rejected on the basis that it is not in the best interests of shareholders, our customers and New Zealand as a whole. The proposal starts with two organisations, creates a third and is not seen by our Board as efficiency-enhancing.
Our Tauranga Container Terminal has outstanding growth potential with low associated capital requirements to achieve this growth. The container terminal is an integrated part of our total business and cannot be split off easily as a discreet operation.
Port of Tauranga has not changed its position on the need for port rationalisation and we remain willing to re-open full merger discussions with Ports of Auckland on terms that would be beneficial to our shareholders. The synergies arising from a full merger would provide for increasing dividends to Auckland Regional Holdings (ARH) for infrastructure projects in the Auckland region, the earlier release of waterfront land (Queen's, Marsden and Captain Cook wharves) to the Auckland community, and avoid the unnecessary duplication of capital expenditure required in the future between the two ports.
Alternatively, port rationalisation will occur naturally if ports simply price and invest to ensure they meet their cost of capital (without ratepayer subsidy), as they are required to do under the Port Companies Act.
For further details, contact:
Mark Cairns
Chief Executive
Port of Tauranga Limited
Ph: 07 572 8829