KEY POINTS:
Auckland International Airport directors will meet over the weekend to determine their stance on the Canada Pension Plan Investment Board partial takeover offer.
The CPPIB's document, made public yesterday, will be in the letterboxes of more than 50,000 shareholders from today.
The 44-page document says the offer for the airport is "at the very high end of comparable international airport valuations" and confirms its modification.
The partial takeover is for 39.53 per cent of the shares in Auckland Airport not already held by CPPIB at a price of $3.6555 a share.
And the summer reading will get even heavier from Monday.
Auckland Airport's board will send out documents running to about 100 pages, including directors' recommendations, a Grant Samuel & Associates assessment of the offer and a report on the passenger and aircraft demand.
The board's chairman, Tony Frankham, said directors would meet over the next two days to finalise their recommendation to shareholders.
"We are aiming to release our recommendation on the partial offer from CPPIB before the market opens on Monday," he said.
"The directors are committed to providing information to enable shareholders to assess the offer, to take advice and to form their views on the offer based on their own circumstances."
Frankham said shareholders should take no action in the meantime.
The Canadians could face a battle convincing the board and analysts who have sounded the alarm about debt levels.
In the leadup to board elections last month new directors, backed by local councils, expressed concerns about ownership being diluted.
Influential Infratil head Lloyd Morrison stated he was uncomfortable with the size of the Canadian stake and that the price they were offering was too low.
CPPIB vice-president and head of infrastructure Graeme Bevans said his company was "not uncomfortable" with changes on the airport board and had spoken to the new directors.
"They have a number of perspectives on the offer - they're supportive of some components and not supportive of others."
The offer opened yesterday with a price per share at a premium of 31 per cent over the share price at market close on Thursday, CPPIB said. Shares closed unchanged at $2.80 yesterday.
In response to concerns about debt levels, CPPIB modified its offer which would ultimately merge the airport with a shell company and take on more debt to unlock higher cash returns for shareholders.
A takeover vehicle - NZ Airports - would merge with AIA and shareholders would receive a stapled security of shares plus a convertible note. The revised offer of stapled securities would consist of an ordinary share valued at 70.55c and a convertible note valued at $2.75.
That will see the convertible note component reduced by 18 per cent to $3.4 billion, and shares would increase more than six times to $862 million.
Shareholders, excluding CPPIB, would receive 20c cash per share.
CPPIB said yesterday that with a 40 per cent holding in AIA, it would only be able to vote 25.7 per cent of the total number of shares in AIA on resolutions to elect and remove directors.
Through the hoops
* Takeover Code rules require that more AIA shareholders must approve the offer than object to it.
* If its offer is successful CPPIB plans to seek to have an amalgamation proposal put to the airport's shareholders.
* The amalgamation would be conditional on support of the AIA board, and require the approval of 75 per cent of shareholders.
* IRD approval would also be needed.
* CPPIB's offer will remain open until March 13.
