KEY POINTS:
The latest offer for Auckland Airport from the Canadian Government's mega-pension fund has hit turbulence in the form of the Manukau City Council.
The council voted at an extraordinary meeting yesterday to limit a single shareholder to no more than 35 per cent of the airport - less than the 40 per cent being sought by the Canada Pension Plan Investment Board. The council also voted not to support having a single overseas owner with a controlling interest.
The Auckland City Council had welcomed the Canadian board's cash offer of $3.65 a share for a 40 per cent stake in the company. This followed a rejection by the airport board of the latest offer.
The councils are the two biggest shareholders in the airport, with 22.8 per cent of the shares between them, and will be crucial to the success or failure of the latest offer.
As a partial bid, the new offer is conditional on the approval of a majority of airport shareholders who respond. Ballot documents are expected to go out within 10 days.
Manukau Mayor Len Brown said the "takeover offer" met some of the council's criteria but not others.
Asked how the council felt about the Canadians chasing a 40 per cent stake when the council had a 30 per cent to 35 per cent upper limit, Mr Brown said those figures were a guideline, "but I think there is a very strong sentiment by our council that that is the extent of the guideline."
Auckland City voted in September to limit a single investor to no more than a 50 per cent stake in Auckland Airport.
Finance general manager Andrew McKenzie yesterday said if there was a way in which the council could keep its 12.75 per cent stake and increase the return to ratepayers "we are obviously very supportive so long as it doesn't compromise the long-term interests of the company".
Earlier analysis indicated the council could keep its stake and increase annual returns by more than $15 million a year.
Mayor John Banks said the council was committed to keeping its 12.75 per cent stake and increasing the value for ratepayers.
