KEY POINTS:
Auckland International Airport's board faces a major shakeup tomorrow which could change the direction of the company.
In the midst of a fresh takeover bid by the Canada Pension Plan Investment Board for 40 per cent of the company, three new directors are seeking a place on a board split over the first Canadian offer and which miscalculated opposition to its preferred suitor from Dubai.
The outcome of tomorrow's meeting could see a big shift in power .
In what is expected to be a fiercely fought contest Infratil chief executive Lloyd Morrison is standing along with Auckland City Council nominee Richard Didsbury and Manukau City's John Brabazon.
With the resignation of board member Mike Smith following the spurning of CPP's first bid, there are four left on the board although director Joan Withers is up for re-election.
What would in past years be a routine rollover could instead be a forum for shareholders to vent unhappiness with the board's performance.
A range of analysts expect the three newcomers to be elected, partly because Auckland City and Manukau City - which hold nearly 23 per cent of the company - are likely to vote for each other's candidates.
And Morrison appeals to many institutions and small shareholders alike given his high profile and expertise in airports although he has faced scrutiny over potential conflicts given Infratil's ownership of Wellington Airport and his backing of a second airport for Auckland at Whenuapai.
Morrison has said legal opinions show Auckland and Wellington airports do not compete and he maintains Whenuapai remains just an idea, and is distant given North Shore City's opposition.
Shareholder Brook Asset Management remains opposed to Morrison's nomination but executive director Paul Glass expects he will be elected along with two others.
"We'd love to have him on board but we think he's too conflicted," Glass said.
"I think it will be very pleasant - I don't think for anyone these are real table thumping issues. This is much more a commercial difference of opinion rather than anyone feeling they've been ripped off in any way."
The Shareholders Association has a special interest in Auckland airport, given the large number of small holders. Around 40,000 own 10,000 shares or less.
Spokesman Des Hunt said on the assumption there were no conflict of interest issues, Morrison was the right candidate.
"We cannot think of a better person to be nominated."
But the association was concerned councils were demanding a presence disproportionate to their shareholding and he worried about the dynamics of an enlarged board.
"We don't want the councils to work against the board. It's not perfect when these three get on and have to work with the current board."
Previous boards had had a strong relationship with the Shareholders Association but the group had not had such a close relationship lately.
It was what councils say is the lack of consultation that spurred them to put their own candidates up after what they say is years of being taken for granted.
Manukau's former mayor Sir Barry Curtis last week recounted how he was left numb by board member Mike Smith's presentation of Dubai Aerospace as virtually a done deal in a phone call to his home at 8.29 one morning in July.
"These Johnny-come-latelys were undermining the integrity of the airport and also selling off a vast reservoir of land."
Manukau City's nominee John Brabazon said the airport board needed closer ties to major shareholders.
"It's not right that a big shareholder has to read about what's going on out there in the newspaper."
The merchant banker, whose experience includes being co-opted on to two Brierley subsidiary boards when the companies were in meltdown, formerly chaired Manukau City Investments Ltd, the council's vehicle to hold a 10.05 per cent stake in the airport.
Brabazon said the handling of the sales process so far had resulted in a split board, shareholder dissatisfaction, management distraction and millions of dollars wasted in costs to bidders and the airport.
He is deemed not to be independent by the board, but Manukau City Mayor Len Brown disagrees.
'You can never guarantee that your appointment will vote the way you want him to - they will exercise their own judgment."
Auckland City's nominee Richard Didsbury was a founder of Kiwi Income Property Trust.
He said it seemed the board appeared to have good reason to reject the Canadian offer but the handling of the process had concerned him..
"It may also be true that they did the best they could in the circumstances. It's very easy to criticise."
Auckland City Mayor John Banks said last night the council was "making progress" but would not be drawn on where the council's votes would be going. "That [existing] board needs a big shakeup," he said.
The results of the election should be known later tomorrow.
Among the voters will be CPP which has already bought a small stake.
They are not saying how they will vote either.
THE MEETING
What: AIA Ltd shareholders' meeting
Where: Ellerslie Event Centre
When: 10.30am tomorrow
